CITY COUNCIL CONFERENCE

MUNICIPAL BUILDING CONFERENCE ROOM 201 WEST GRAY, NORMAN, OK

JULY 24, 2018

5:00 P.M.

1. CHANGE ORDER NO. TWO TO CONTRACT K-1718-117: WITH LIPPERT BROS., INC., INCREASING THE CONTRACT AMOUNT BY $66,171 FOR A REVISED CONTRACT AMOUNT OF $937,723 TO RELOCATE THE POWER FOR THE LIGHT POLES BETWEEN FIELDS 8 AND 9, REVISE THE GRADING ON FIELD 8 DUE TO RAISING THE HEIGHT OF THE RETAINING WALL, AND REVISE THE GRADING ON FIELD 9 DUE TO THE ELEVATION OF THE EXISTING IRRIGATION MAIN LINE.

2. CHANGE ORDER NO. ONE TO CONTRACT K-1819-1 WITH CENTRAL CONTRACTING SERVICES, INC., INCREASING THE CONTRACT AMOUNT BY $95,961 FOR A REVISED CONTRACT AMOUNT OF $1,547,476, TO ADD THE EAST SIDE RECYCLING CENTER PAD TO THE FYE2019 URBAN CONCRETE PAVEMENT STREET MAINTENANCE BOND PROGRAM.

3. CHANGE ORDER NO. ONE TO CONTRACT K-1819-4 WITH CENTRAL CONTRACTING SERVICES, INCREASING THE CONTRACT AMOUNT BY $112,200 FOR A REVISED CONTRACT AMOUNT OF $441,750 TO UTILIZE THE FULL BUDGET AMOUNT FOR THE FYE 2019 CONCRETE SIDEWALK PROJECTS

4. PRESENTATION BY MARKET STREET SERVICES, INC., OF THE DRAFT COMMUNITY ASSESSMENT AND COMPETITIVE SCORECARDS REPORT PREPARED FOR THE NORMAN ECONOMIC DEVELOPMENT COALITION.

City of Norman, OK Municipal Building Council Chambers 201 West Gray Norman, OK 73069 Master

File Number: K-1718-117 CO#2

File ID: K-1718-117 CO#2 Type: Contract Status: Consent Item

Version: 1 Reference: Item 18 In Control: City Council

Department: Parks and Recreation Cost: $66,171.00 File Created: 07/10/2018 Department

File Name: Change Order 2 for Griffin Park Phase I North Field Final Action: Improvements Title: CHANGE ORDER NO. TWO TO CONTRACT K-1718-117: BY AND BETWEEN THE NORMAN MUNICIPAL AUTHORITY AND LIPPERT BROS., INC., INCREASING THE CONTRACT AMOUNT BY $66,171 FOR A REVISED CONTRACT AMOUNT OF $937,723 TO RELOCATE THE POWER FOR THE LIGHT POLES BETWEEN FIELDS 8 AND 9, REVISE THE GRADING ON FIELD 8 DUE TO RAISING THE HEIGHT OF THE RETAINING WALL, AND REVISE THE GRADING ON FIELD 9 DUE TO THE ELEVATION OF THE EXISTING IRRIGATION MAIN LINE.

Notes: ACTION NEEDED: Acting as the Norman Municipal Authority, motion to approve or reject Change Order No. Two to Contract K-1718-117 with Lippert Bros., Inc., increasing the contract amount by $66,171 for a revised contract price of $937,723 and authorize the execution thereof.

ACTION TAKEN: ______

Agenda Date: 07/24/2018

Agenda Number: 18

Attachments: Text File, Change Order, PCO#2, Griffin Phase I ADG Memo CO 002 7-10-18, CO2 Letter 7-10-18 Project Manager: Matt Hendren, Park Superintendent

Entered by: [email protected] Effective Date:

History of Legislative File

Ver- Acting Body: Date: Action: Sent To: Due Date: Return Result: sion: Date:

Text of Legislative File K-1718-117 CO#2

Body BACKGROUND: On October 13, 2015, Norman citizens passed the NORMAN FORWARD Initiative which will fund various projects through a one-half percent (½%) sales tax over 15 years. Included in the NORMAN FORWARD Initiative is an upgrade of the Griffin Park Soccer Complex. Eventually all of the fields will be converted to soccer and will total 20 youth fields.

On March 14, 2017, the City Council, acting as Trustees of the Norman Municipal Authority (NMA) awarded contract K-1617-114 to the Planning Design Group (PDG) to provide master planning designs for the Griffin Park Soccer Complex. On August 8, 2017, the NMA Trustees adopted the Griffin Park Sports Complex Master Plan (Resolution R-1718-22).

City of Norman, OK Page 1 Printed on 7/20/2018 Master Continued (K-1718-117 CO#2)

On May 22, 2018, the City Council, acting as Trustees of the Norman Municipal Authority (NMA), awarded contract K-1718-117 to Lippert Bros., Inc., to provide re-grading of fields 8 and 9, adding retaining walls, fencing and drainage, as well as re-lighting fields 1-4, and adding lights to field number 8.

DISCUSSION: Work on the Griffin Park Phase I North Field Improvements has progressed since the contract for construction was awarded. Due to the exact location of the existing power lines between fields 8 and 9 being unknown at the time of the contract award, the power lines for the light poles must be relocated. Due to the elevation of the existing irrigation line on field 9 being shallower than anticipated, the grading plan must be adjusted. Grading adjustments are also needed on field 8 to accommodate raising the height of the retaining wall. Raising the wall on field 8 will allow for greater expansion on field 7 to the south.

Lippert Bros., Inc. has submitted Change Order No. two in the total amount of $66,171. Following is a description of work to be completed:

· Relocate the power for the light poles between fields 8 and 9 due to the existing power lines being in the area of the footing for the new retaining wall. · Revise the grading on field 9 due to the elevation of the existing irrigation sprinkler main. · Revise the grading on field 8 to accommodate raising the height of the retaining wall. Raising the wall on field 8 will allow for greater expansion on field 7 to the south.

Total cost of the change order for this item is $66,171.

Our consultants from PDG have reviewed this change order and agree that it is appropriate and should be approved. Our project management consultants from ADG have also reviewed the request and agree with its approval.

RECOMMENDATION: It is recommended that the Norman Municipal Authority/City Council approve Change Order No. Two to Contract K-1718-117 increasing the contract amount by $66,171, to provide power line relocation between fields 8 and 9 as well as revised grading for fields 8 and 9 for the Griffin Park Phase I North Field Improvements Project. Funding for the Change Order exists in project contingencies available in Griffin Park, Construction (account 051-9639-452.61-01; project NFB001).

City of Norman, OK Page 2 Printed on 7/20/2018

MEMO

DATE: 7/10/2018

TO: Matt Hendren

FROM: ADG Team

SUBJECT: NORMAN FORWARD – Griffin Park Phase I North Field Improvements – Change Order #002

PROJECT: NORMAN FORWARD – Griffin Park Phase I North Field Improvements

PROJECT NO: 16-003 PHASE NO: Construction

ADG has reviewed the summary of the referenced Change Order No. 2 provided by PDG along with their explanation and estimate of cost for each item. ADG is in agreement with PDG’s recommendations.

Leslie Tabor Program Management

ADG, PC 920 W Main Oklahoma City, OK 73106 405.232.5700

July 10, 2018

Mr. Matt Hendren City of Norman

RE: Griffin Park, Phase I North Field Improvements – Change Order #002

Dear Mr. Hendren,

Planning Design Group has reviewed the summary of the referenced Change Order #2 provided by Lippert Bros. Inc. PDG agrees with their explanation and estimate of cost for each item. PDG recommends Change Order #2 for approval.

I look forward to hearing from you in the near future.

Sincerely, PLANNING DESIGN GROUP

Geoffery Evans, PLA, ASLA Project Manager

5314 South Yale Ave., Suite 510, Tulsa, Oklahoma 74135 Phone 918/628-1255 Fax 918/628-1256

City of Norman, OK Municipal Building Council Chambers 201 West Gray Norman, OK 73069 Master

File Number: K-1819-1

File ID: K-1819-1 Type: Contract Status: Consent Item

Version: 1 Reference: Item 11 In Control: City Council

Department: Public Works Cost: $1,547,476.00 File Created: 07/02/2018 Department

File Name: Urban Concrete Project 2019 Final Action:

Title: CONSIDERATION OF AWARDING OF BID 1819-1 ; CONTRACT K-1819-1 WITH CENTRAL CONTRACTING SERVICES, INC., IN THE AMOUNT OF $1,451,515; CHANGE ORDER NO. ONE INCREASING THE CONTRACT AMOUNT BY $95,961 FOR A REVISED CONTRACT AMOUNT OF $1,547,476, PERFORMANCE BOND B-1819-1; STATUTORY BOND B-1819-2; AND MAINTENANCE BOND MB-1819-1 FOR THE URBAN CONCRETE PAVEMENT STREET MAINTENANCE BOND PROGRAM, FYE 2019 LOCATIONS, AND ADOPTION OF RESOLUTION R-1819-2 GRANTING TAX EXEMPT STATUS.

Notes: ACTION NEEDED: Acting as the City Council and Norman Utilities Authority, motion to accept or reject all bids meeting specifications; and, if accepted, award the bid in the amount of $ 1,451,515 to Central Contracting Services, Inc., as the lowest and best bidder meeting specifications; approve Contract K-1819-1, Change Order No. One Increasing the contract amount by $95,961 for a revised contract amount of $1,547,476, and the performance, statutory, and maintenance bonds; authorize execution of the contract and bonds; direct the filing of the bonds, and adopt Resolution R-1819-1

ACTION TAKEN: ______

Agenda Date: 07/24/2018

Agenda Number: 11

Attachments: K-1819-1, CO#1 K-1819-1, Perf B-1819-1, Stat B-1819-2, MB-1819-1, Location Maps, Table of FYE 2019 Location, Letter, R-1819-1, Requisition Project Manager: Tony Mensah, Capital Projects Engineer

Entered by: [email protected] Effective Date:

History of Legislative File

Ver- Acting Body: Date: Action: Sent To: Due Date: Return Result: sion: Date:

Text of Legislative File K-1819-1

Body BACKGROUND: In the Norman General Obligation Bond Election of 2016, voters approved the Street Maintenance Bond Program, a 5-year, 4-phase program to address maintenance needs on neighborhood streets . The four categories include (1) Urban Asphalt Street Rehabilitation, (2) Urban Concrete Street Rehabilitation, (3)

City of Norman, OK Page 1 Printed on 7/20/2018 Master Continued (K-1819-1)

Urban Road Reconstruction and (4) Rural Road Rehabilitation. Prior to the election, the City provided a list of all streets included in the program based upon the pavement condition data from the City ’s current Pavement Management System. Seven (7) neighborhood additions with 17 locations on urban concrete streets were identified for the third year (FYE 2019) of the program. A list of the locations and the associated maps are attached.

DISCUSSION: The bid opening was conducted on June 14, 2018. Bid specifications and documents were advertised on May 24, 2018 and May 31, 2018 in accordance with State Law. Seven (7) potential bidders acquired plans and specifications. Three (3) contractors submitted bids. The lowest bid, in the amount of $1,401,464 was submitted by RDNJ, LLC dba A-Tech Paving of Edmond, OK. The next low bidder is Central Contracting Services, Inc. of Norman, OK, in the amount of $1,451,515. All bids received are less than the engineer’s estimate of $1,778,400. Staff has done a comparative analysis of these bids and believes the bids to be competitive and represent a fair price. The bid tabulation is attached.

The State Competitive Bidding Act (Act) requires that the contract be awarded to the “lowest responsible bidder”. However, the Act does not define lowest responsible bidder. Section 8-204 of the City Code states that “[A]cceptance will be made of that bid most advantageous to the City, considering price, quality, date of delivery, and other pertinent factors.” Although price is important, other factors can and should be considered to determine whether the bid represents the best value for the City. Typically these factors include the bidder ’s financial or pecuniary ability to complete the contract, integrity and trustworthiness, skill, judgment, ability to perform faithful and conscientious work, promptness, experience, necessary facilities and equipment for doing the work, efficiency, previous performance of satisfactory work or other essential factors.

Staff carefully reviewed the bid packages. The lowest bidder, RDNJ, LLC dba A -Tech Paving, is currently working on five current projects for the City of Norman. Most of these projects are incomplete and significantly behind schedule. For instance, the 2015 Main Street Pavement Repair Project is still incomplete. The 2017 Imhoff Creek Channel Repair Project is about four and a half months behind schedule. The current Lahoma Street Project is over two months behind schedule. City Staff has also been informed that RDNJ is having similar problems in the City of Oklahoma City. This raised concerns that RDNJ, LLC dba A-Tech Paving would not have adequate personnel and equipment to complete the Urban Concrete contract in the required timeframe. This contractor has also been non-compliant with other contractual obligations. The findings of the selection committee are outlined in the attached letter to RDNJ.

For the above mentioned reasons, city staff recommends that RDNJ, LLC, d/b/a A-Tech, not be considered the lowest responsible bidder on this project. Staff has met with the Contractor to discuss corrective measures on the pending projects, and if completed satisfactorily, RDNJ will be considered for future City projects.

City staff has also reviewed the bids and documents submitted by the next low bidder, Central Contracting Services, Inc., and their current performance on projects with City of Norman. Staff has found their documentation to be in compliance with City of Norman’s Standard Specifications, and their current performance acceptable, and therefore is considered the lowest responsible bidder.

If approved, the base bid for this project will complete the third year (FYE 2019) locations in the Urban Concrete Pavement Rehabilitation portion of the 5-year 2016 Street Maintenance Bond Program. If approved, construction will begin on these projects at the end of July 2018. The construction time for this project is 180 days with an estimated completion at the end of January 2019. However, projects near schools may be postponed to coincide with breaks or following the school year to avoid interruptions to the drop -off and pick-up procedures at the schools. The completion could also be delayed due to cold temperatures in the winter months that hinder paving operations. All work will be completed within FYE 2019.

The recommended bid from Central Contracting Services, Inc. is $1,451,515 or 18% or $326,885 below the engineer’s estimate of $1,778,400. The project is funded in the Capital Fund, Urban Concrete Pavement Bond Program, Construction (account 050-9393-431.61-01; projects BP0405 through BP0412), as shown on the attached Table.

City of Norman, OK Page 2 Printed on 7/20/2018 Master Continued (K-1819-1)

Additionally, the Norman Utilities Authority (NUA) would like to utilize these favorable concrete prices to construct a paved area for the East Norman Recycling Drop Off Center. The drop off area will be north of the East Norman Library on East Alameda Street. The site is bounded by a drainage ditch on the north, the parking lot will be approximately 75 feet by 110 feet with a retaining wall on the south end. In addition to the concrete bid prices, NUA staff negotiated prices for retaining wall, curb and gutter, reinforcing steel, and mobilization.

Change Order No. 1, which will be funded separately with Norman Utilities Authority funds, will increase the contract an additional $95,961 for a revised total of $1,547,476. This project is scheduled to be constructed in fall 2018. Sanitation Utility funds in the amount of $129,500 are available in Sanitation Capital Projects, Construction (account 033-9975-432.61.01; project SA0010).

RECOMMENDATION No. 1: For the above mentioned reasons, Staff, after reviewing the bids, recommends Bid 1819-1 for Street Maintenance Bond Program - Urban Concrete be awarded to the lowest responsible bidder, Central Contracting Services, Inc. of Norman, Oklahoma, for $1,451,515.

RECOMMENDATION No. 2: Staff further recommends that, upon acceptance of Bid 1819-1, the following contract and bonds be approved:

Contract K-1819-1 Performance Bond B-1819-1 Statutory Bond B-1819-2 Maintenance Bond MB-1819-1

RECOMMENDATION No. 3: Staff further recommends that Central Contracting Services, Inc. be authorized and appointed as Project Agent via Resolution R-1819-1 for the City of Norman portion of the funds.

RECOMMENDATION No. 4: NUA staff recommends that Change Order No. 1, for the East Norman Recycling Drop Off Center, increasing the contract amount by $95,961, be approved for a revised contract price of $1,547,476.

City of Norman, OK Page 3 Printed on 7/20/2018 Contract K-1819-1 Change Order No. 1 Page 1of2

CHANGE ORDER SUMMARY NORMAN MUNICIPAL AUTHORITY CITY OF NORMAN CLEVELAND COUNTY, OKLAHOMA

DATE: July 24, 2018 CHANGE ORDER NO.: One 1 CONTRACT NO.: K-1819-1

PROJECT: Street Maintenance Bond Program CONTRACTOR: Central Contracting Services, Inc. 17301 South Sunnylane, Norman, OK 73071

Contract Time Final Completion

ORIGINAL: 180 Calendar Days PREVIOUS CHANGE ORDERS: Q Calendar Days

THIS CHANGE ORDER: 30 Calendar Days REVISED AMOUNT: 210 Calendar Days

ORIGINAL START DATE: July 31 , 2018 ORIGINAL COMPLETION DATE: January 27. 2019 PREVIOUS COMPLETION DATE: January 27. 2019

NEW COMPLETION DATE: February 26. 2019

Contract Amount ORIGINAL CONTRACT W/O ALLOWANCE: $1,451,515.00

PREVIOUS CHANGE ORDERS: $0.00

THIS CHANGE ORDER: $95.961 .00 REVISED CONTRACT: $1.547,476.00 Contract K-1819-1 Change Order No. 1 Page 2 of 2

Item Descri~tion Quantitl!'. Units Unit Price Total 9-inch Concrete (3000PSI) 1,111 SY $55.00 $61 , 105.00 Concrete Flume Complete (4-inch sidewalk) 6 SY $54.00 $324.00 Solid Slab Sodding 420 SY $3.00 $1,260 .00 Additional: Retaining Wall 2.5-ft x 110-ft x 6- 7 CY $500.00 $3,500.00 inch Additional: Concrete Curb and Gutter 380 LF 380 LF $15.00 $5,700.00 Additional: Reinforcing Steel (Grade 60) 9536 9,536 LBS $2.00 $19,072 .00 LBS 1 LS Additional: Mobilization $5,000.00 $5,000.00

Total $95,961 .00

SUBMITTED BY Date: 7 (r a/ 18 CONTRACTOR:

RECOMMENDED BY Date: NMA CAP. PROJ. ENGINEER:

APPROVED AS TO FORM AND LEGALITY:

ACCEPTED BY Date: NORMAN MUNICIPAL AUTHORITY: Chairman

City of Norman, OK Municipal Building Council Chambers 201 West Gray Norman, OK 73069 Master

File Number: K-1819-4

File ID: K-1819-4 Type: Contract Status: Consent Item

Version: 1 Reference: Item 13 In Control: City Council

Department: Public Works Cost: $441,750.00 File Created: 06/27/2018 Department

File Name: Award of Bid for the FYE 2019 Sidewalk Concrete Final Action: Projects Title: CONSIDERATION OF AWARDING BID 1819-3 ; CONTRACT K-1819-4 BY AND BETWEEN THE CITY OF NORMAN, OKLAHOMA AND CENTRAL CONTRACTING SERVICES, IN THE AMOUNT OF $329,550; CHANGE ORDER NO. ONE INCREASING THE CONTRACT AMOUNT BY $112,200 FOR A REVISED CONTRACT AMOUNT OF $441,750; PERFORMANCE BOND B-1819-7; STATUTORY BOND B-1819-8, AND MAINTENANCE BOND MB-1819-4 FOR THE FYE 2019 CONCRETE SIDEWALK PROJECTS; AND ADOPTION OF RESOLUTION R-1819-4 GRANTING TAX EXEMPT STATUS.

Notes: ACTION NEEDED: Motion to accept or reject all bids meeting specifications; and, if accepted, award the bid in the amount of $329,550 to Central Contracting Services, Inc., as the lowest and best bidder meeting specifications; approve Contract K-1819-4, Change Order No. One increasing the contract amount by $112,200 for a revised contract amount of $441,750 and the performance, statutory, and maintenance bonds; authorize execution of the contract and bonds; direct the filing of the bonds, and adopt Resolution R-1819-4.

ACTION TAKEN: ______

Agenda Date: 07/24/2018

Agenda Number: 13

Attachments: Bid Tabulation, Contract Documents_Bonds-Signed, Change Order No. 1-Signed, Location Maps-2019 SIDEWALK CONCRETE PROJECTS, Requisition-296399, R-1819-4, Master Project Manager: Jack Burdett, Engineering Assistant

Entered by: [email protected] Effective Date:

History of Legislative File

Ver- Acting Body: Date: Action: Sent To: Due Date: Return Result: sion: Date:

Text of Legislative File K-1819-4

Body BACKGROUND: Pursuant to State Law (Title 11, Section 36-104), the construction and maintenance of sidewalks is the responsibility of the adjacent property owner. In 1997, City Council recognized the need to create sidewalk programs to reduce this burden to existing property owners. Funds were allocated for four (4)

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separate capital project accounts each year thereafter. The FYE 2019 Capital Improvement Program Budget includes these four (4) concrete sidewalk programs and one (1) additional program “Sidewalks and Trails”. The projects are similar in nature, so more competitive prices have historically been obtained by bidding them together. Therefore, staff has combined these projects into one project entitled the “FYE 2019 Sidewalk Concrete Projects”. These five (5) programs are described in detail below and outlined in Table 1 (attached).

The Citywide Sidewalk Reconstruction Program is intended to assist property owners in repairing existing sidewalks and constructing new sidewalks along an entire city block. Property owners who wish to participate in the Citywide Sidewalk Reconstruction Project will pay 50% of the estimated cost, with the City paying the remaining 50% from funds allocated to this project.

The Sidewalk Accessibility Program provides sidewalk ramps where none exist and rebuilds existing ramps that do not comply with current Americans with Disabilities Act (ADA) standards. This project will construct approximately sixteen (16) curb ramps during FYE 2019. Locations are determined at the request of citizens and along arterial and collector streets that do not currently have ramps at street -sidewalk intersections. The location in this year’s program will include intersections along Cherry Creek Drive from Main Street to Knob Hill Court.

The Sidewalk Program for Schools and Arterials Program is used to construct new sidewalks adjacent to elementary schools that have no sidewalks and along walking routes to the schools. This year ’s project has three (3) locations: the east side of North Berry Road from Iowa Street to Denison Drive in the Cleveland Elementary School area; the south side of West Boyd Street from 650 feet east of 24th Ave. S.W. to Nancy Lynn Terrace in the Alcott Middle School area; and the south side of West Imhoff Road from Walnut Road to Castlewood Drive serving McKinley Elementary School and the University of Oklahoma.

The Downtown Area Sidewalks and Curbs Program will repair hazardous or deteriorated sidewalks, ramps, and curbs in the downtown area. The locations will be concentrated along the east side of Porter Avenue and Crawford Avenue south of Main Street during FYE 2019.

The Sidewalks and Trails Project constructs new sidewalk and trails throughout the city, in conformance with adopted plans including the Greenbelt Master Plan; Bikeway & Transportation Master Plan; and Parks Master Plan. The location this fiscal year is concentrated along the north side of Main Street from 700 feet west of 24th Avenue West to Berry Road to close sidewalk gaps and provide sidewalk and ramp improvements at intersections.

DISCUSSION: Bid documents and specifications were advertised according to State Law. Ten (10) contractors received the bid documents and four (4) bids were submitted on June 14, 2018. The lowest best bid, in the amount of $329,550, was received from Central Contracting Services, Inc. of Norman. Central Contracting Services, Inc. is currently under contract for utility construction and relocation projects for the Public Works Department in Norman. Central Contracting Services has successfully performed work for the Sidewalk Concrete Projects in fiscal years 2010, 2011, 2012, 2015 & 2016. The Engineer’s estimate for this work is $445,000.

The bid amount for each of the five (5) projects is shown separately on Table 1. The bids for all the projects and programs are less than the budgeted amount.

For the “Citywide Sidewalk Reconstruction” citizens have the option of using their own contractor, using the City ’s contractor, or performing the work themselves. Unencumbered funds for this fiscal year will be used in the City ’s 50% match of this program, if the property owner chooses to use their own contractor or do the work themselves.

The “Sidewalk Accessibility Program” constructing curb ramps along Cherry Creek drive can construct four (4) additional curb ramps along Cherry Creek Drive; a total of twenty (20); adding $7,015 from Change Order No. One to the budgeted amount of $30,000.

The “Sidewalk Program for Schools and Arterials” will close sidewalk gaps and create accessible routes with corner ramps and improve existing driveway cross slopes. Additional funding in Change Order No. 1 in the amount of $48,075 can provide for additional work on the next identified highest-ranked school sidewalk and

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ramps on Fairlawn Drive in the Eisenhower Elementary School area. This will bring the contract amount to the budgeted amount of $180,000.

The “Downtown Area Sidewalk and Curbs Program” can benefit from Change Order No. 1 to repair additional sidewalk or curb in the downtown area identified by owners or citizen request during the fiscal year. The amount of $9,740 will bring the contract to the budgeted amount of $50,000.

An additional $47,370 used from Change Order No. 1 will be used for the “Sidewalks and Trails” projects to allow for additional sidewalk improvements on the south side of Main Street. This will bring the final contract to the budgeted amount of $150,000.

If approved, construction is scheduled to begin in August 2018. The contractor will stage the five (5) programs to complete sidewalk repair reconstruction requests throughout the year, construct school sidewalk during school winter and summer breaks and begin with some school sidewalk immediate needs in early August. The project plan will follow schedule below:

· “Citywide Sidewalk Reconstruction” - August-Sept. 2018, February & May 2019 · “Sidewalk Accessibility” - October 2018 · “Sidewalks and Trails” - January & February, 2019 · “Downtown Sidewalks and Curbs” project - March-April, 2019 · “Sidewalk Program for Schools and Arterials” - November 2018 & June 2019

Resolution R-1819-4 confers upon Central Contracting Services, Inc. the limited agent status for the purchase of materials to be incorporated in the project on a sales tax-exempt basis. The bid documents offered tax-exempt status to all bidders.

Due to the desirable unit pricing by the contractor, City staff recommends increasing the encumbered funding to the contractor to complete additional work that may be requested during the fiscal year; as shown on Table 1 for Change Order No. 1, which increases the contract amount by $112,200 for a total contract price of $441,750.

RECOMMENDATION NO. 1 : Staff has reviewed the bids and recommends that Bid 1819-03 for the FYE 2019 Concrete Sidewalk Program be awarded to Central Contracting Services, Inc. in the amount of $329,550.

RECOMMENDATION NO. 2: Staff further recommends that the following contract and bonds be approved:

Contract K-1819-4 Performance Bond B-1819-7 Statutory Bond B-1819-8 Maintenance Bond 1819-4

RECOMMENDATION NO. 3 : Staff further recommends that Central Contracting Services, Inc. be authorized and appointed as Project Agent via Resolution R-1819-4.

RECOMMENDATION NO. 4 : Staff further recommends that Change Order No. 1, which increases the contract amount by $112,200 with a total contract price of $441,750, be approved.

City of Norman, OK Page 3 Printed on 7/20/2018

To: Norman City Council Members From: Jason Smith, President and CEO Date: July 19, 2018 Re: Presentation on Strategic Planning

Norman City Council Members,

We look forward to visiting with you during our presentation on July 24. Matt Tarleton, Executive Vice President and Principle with Market Street Services, and I will be in attendance and available for questions.

This project dates back nearly 18 months when the Norman Economic Development Coalition Board of Directors decided to move forward with a community-wide project to set goals and objectives for the economic development program. The four NEDC partners each appointed several representatives to serve on a committee that began meeting in July to employ a consultant and direct the activities of community engagement and planning. Market Street was determined to be the most qualified company, having recently completed planning projects for Austin, Tulsa, Topeka and Indianapolis, among others. Market Street promised to deliver a well-researched plan that relied on both empirical and anecdotal evidence as the basis of a project that could be adopted by NEDC as well as its partners across the city.

The organizations have engaged nearly 2,000 Norman residents as part of the process. The final strategy is scheduled for release in the fall. Although we will not a have finalized strategic plan, we will be discussing the findings up to this point and Matt will talk about potential strategy items being considered. The committee and board will be finishing up the final recommendations in July and August.

Attached please find the two completed documents. The first is a community assessment, which uses widely available data to give a snapshot of the Norman demographic and economic landscape. The document also compares Norman to some of its peers including other university cities as well as the U.S. and Oklahoma City Metropolitan area. Also attached is a target sector analysis that talks about various industries for which Norman could be a fit for attractions, expansion and startups. Included in both documents is a list of steering committee members, which represent a cross section of the community including City of Norman, Cleveland County, the education community, non-profits, various businesses and health care. All of this information (reports, committee members, etc.) is also available at www.normanedplan.com.

Again, thank you for the invitation and we look forward to seeing you on Tuesday.

Jason Smith

`

COMMUNITY ASSESSMENT & COMPETITIVE SCORECARDS (REVISED DRAFT) NORMAN, OKLAHOMA

Submitted by Market Street Services, Inc. www.marketstreetservices.com

January 2017

Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma TABLE OF CONTENTS

Project Overview ...... 1 Steering Committee...... 2 Community Assessment...... 3 Introduction: Embracing and Evolving a “University Town” ...... 4 1. Changing Preferences and Regional Growth Patterns ...... 5 2. Emerging Threats to Workforce Competitiveness ...... 9 3. Economic Transition: Towards a More Innovative Economy...... 15 4. Public Education: Developing and Retaining Talent in Norman...... 24 5. Quality of Life in a University Town ...... 30 6. Growth, Development, and Community Vision ...... 36 Competitive Scorecards ...... 41 Economic Performance ...... 42 Workforce Sustainability ...... 44 Innovation and Entrepreneurship ...... 46 Business Environment ...... 48 Quality of Life ...... 50 Competitive Scorecards: Data Sources ...... 52 Endnotes...... 54

Cover photos sourced from the NEDC website.

January 2017

Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma PROJECT OVERVIEW The five-phase research and strategic planning process will last approximately nine months, concluding in May 2018. A diverse Steering Committee comprised of representatives from the public, private, and non- profit sectors will guide the process and ensure that it lays the foundation that will allow people and businesses to thrive and wealth to accumulate in the community.

PHASE ONE: STAKEHOLDER ENGAGEMENT The Economic Development Strategic Plan must be adequately informed by the wants and needs of Norman’s residents, workers, and employers. A series of one-on-one interviews and focus groups were conducted in October 2017. This input is complemented by feedback received from an online survey open to all residents and business in the Norman area that solicited more than 1,600 responses.

PHASE TWO: COMMUNITY ASSESSMENT The Community Assessment will provide a detailed examination of Norman’s competitiveness as a place to live, work, and do business, weaving qualitative feedback from phase one with quantitative analysis to produce a set of “stories” that examine Norman’s past, present, and future with respect to economic competitiveness. This narrative Assessment will be complemented by a set of scorecards that illustrate how the area compares to nine other communities that it competes with for jobs and workers.

PHASE THREE: TARGET SECTOR ANALYSIS The Target Sector Analysis will build upon the Community Assessment by providing a deeper examination of the community’s economic composition. It will specifically identify those sectors of economic activity for which Norman is most competitive and which are most likely to support future job and wealth creation in the years ahead.

PHASE FOUR: ECONOMIC DEVELOPMENT STRATEGIC PLAN Informed by the input and research findings gleaned from phases one through three, the Economic Development Strategic Plan will detail a series of objectives related to the community’s identified challenges and opportunities, and a corresponding set of actions, investments, and initiatives. That can help achieve those objectives and advance economic development in Norman over the next five to ten years. The Plan will be holistic, actionable, measurable, and considerate of relevant best-practice programs, policies, and initiatives from communities around the country.

PHASE FIVE: IMPLEMENTATION PLAN Timely and effective implementation is critical to the ultimate success of the Economic Development Strategic Plan. If the Strategic Plan represents what Norman and its community leadership need to do in order to realize the community’s full economic potential, the Implementation Plan helps define how the community’s leadership can collaboratively, effectively, and efficiently advance implementation. Specifically, the Implementation Plan will prioritize initiatives, formalize timelines for implementation, identify roles and responsibilities for lead and supporting organizations, evaluate financial and staff capacity to support implementation, and define performance metrics to track implementation progress and return on investment.

January 2017 Page 1

Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma STEERING COMMITTEE The following individuals have generously volunteered their time to serve the community and this process by providing strategic guidance, input, and oversight throughout the process, attending seven meetings from October 2017 through May 2018.

INDIVIDUAL REPRESENTING ORGANIZATION Andy Paden (Committee Chair) Moore Norman Technology Center Councilmember Kyle Allison City of Norman Jane Bowen Moore Norman Technology Center Superintendent Councilmember Breea Clark City of Norman Shelley Coleman Cox Norman Chamber of Commerce Dr. Michael Detamore University of Oklahoma Mike Fowler NEDC Board Member Anil Gollahalli NEDC Board Member Patrick Grace, PE NEDC Board Member Shane Hampton University of Oklahoma Steve Ketchum Moore Norman Technology Center Chris Kuwitzky University of Oklahoma Steve Lewis NEDC Board Member, City Manager Scott Martin Norman Chamber of Commerce President Curtis McCarty Norman Chamber of Commerce Chair Nick Migliorino Norman Public School System Superintendent Mayor Lynne Miller City of Norman Daniel Pullin NEDC Board Member Dan Quinn NEDC Board Chair Andy Sherrer Moore Norman Technology Center Board President Jason Smith NEDC President Richie Splitt Norman Regional Health System CEO Commissioner Darry Stacy Cleveland County Chuck Thompson Sooner Centurion Chair Casey Vinyard NEDC Board Member Daren Wilson United Way of Norman

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma COMMUNITY ASSESSMENT This assessment examines the competitive issues facing Norman by evaluating them through the prism of what Market Street believes to be the three critical aspects of a community: its people, their prosperity, and the quality of place. Findings related to these key attributes are incorporated into six key stories that help explain its current realities, key successes, and remaining challenges. These stories emerged from public input provided by residents in Norman as well as in-depth analysis of data covering demographic, socioeconomic, economic, and quality of life trends within the community. Collectively, they help take stock of conditions in the community as they presently exist and identify initial areas that may warrant strategic attention. Before examining these stories in detail, a few important notes on the quantitative analysis and qualitative input presented herein are necessary.

INTERVIEWS AND FOCUS GROUPS: A thorough assessment of a community’s strengths, weaknesses, opportunities, and challenges must be informed by input from the people that live and work in the area. Accordingly, a series of focus groups and interviews with individuals from the community’s public, private, and non-profit sectors was conducted in October 2017.

COMMUNITY SURVEY: In addition to in-person input solicited via focus groups and interviews, an online community survey was open to the public for roughly two weeks in October and November 2017. A total of 1,602 residents, workers, and business owners responded to the survey. This critical input will ensure that the Assessment and forthcoming Strategic Plan are well-informed of the needs, wants, and opinions of residents, workers, and businesses in Norman. Public input gathered from these focus groups, interviews, and community survey is integrated throughout the report and differentiated by red text.

DATA SOURCES: A variety of public and private data sources are used throughout this Assessment. Public sources include the Census Bureau, the Bureau of Labor Statistics (BLS), the Bureau of Economic Analysis (BEA), the National Center for Education Statistics (NCES), the Federal Bureau of Investigation (FBI), and the Internal Revenue Service (IRS). Proprietary data is sourced from Moody’s Economy.com and Economic Modeling Specialists Intl. (EMSI).

ASSESSMENT GEOGRAPHIES: Throughout this assessment, the City of Norman is utilized as the primary geographic unit of analysis, and is typically referred to as “Norman,” “the city,” or “the community” in tables, charts, and other figures. In addition to the Oklahoma City, OK metropolitan statistical area and national averages, the community’s performance is benchmarked against three cities with which it shares certain characteristics and/or competes for jobs, workers, and investment: Ann Arbor, Michigan; Boulder, Colorado; and Lawrence, Kansas.

COMPETITIVE SCORECARDS: A set of Competitive Scorecards accompany this Assessment and are presented at the conclusion of this report. These scorecards compare the Norman area (Cleveland County) to a larger set of nine peer communities: Boone County, MO (Columbia); Boulder County, CO (Boulder); Douglas County, KS (Lawrence); Hays County, TX (San Marcos); Johnson County, IA (Iowa City); Lancaster County, NE (Lincoln); Story County, IA (Ames); Washington County, AR (Fayetteville); and Washtenaw County, MI (Ann Arbor). Five scorecards measure the county’s competitiveness across multiple indicators of economic performance, workforce sustainability, innovation and entrepreneurship, business environment, and quality of life.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

INTRODUCTION: EMBRACING AND EVOLVING A “UNIVERSITY TOWN” This Community Assessment presents a narrative discussion of Norman’s strengths and weaknesses and a candid examination of its past, present, and future with respect to its economic competitiveness. Beyond population growth, underlying demographics and socioeconomics reflect the city’s changing position within the region and among the benchmark communities. Underlying challenges with respect to workforce competitiveness are beginning to emerge. At the same time, this city’s asset base – notably, the University, its neighboring built environments, and the community’s other public institutions of learning – is filled with opportunity to help the overcome these challenges and advance the community’s vision.

So what is this vision? While this is not a visioning process, it is evident from the input that there considerable debate among residents and community leaders regarding the ideal path for Norman with regards to its growth and development. In general, residents want to see Norman reach its potential, becoming a more innovative and prosperous economy. Input from stakeholders around the community expressed a desire to have a more thriving community that offers a high quality of life for individuals of all ages and backgrounds; one that is attractive and welcoming to people of all ages, cultures, and backgrounds.

Currently though, residents feel that Norman is divided, primarily with regards to how Norman should grow, what type of growth should occur, and who should pay for it. When compared to its peer set of university- influenced communities, distinctions begin to emerge between the “traditional University town” as so many described Norman and the more innovative economies of Boulder and Ann Arbor, in particular. While residents hope to see elements of a more innovative economy in Norman, so too do they hope to preserve elements of this “traditional university town” that they have come to grow and embrace, notably the value that it places on public education, the beauty of its campus environment, the comradery of gamedays, the proliferation of festivals, and the balance of political perspectives that many feel is missing in similar communities across the state. And so, the economic vision for Norman is one that seeks to both embrace and evolve the “university town.”

If Norman is to advance this vision and become a more prosperous and vibrant place to live, work, and do business along the way, it will need to address a variety of issues in order to successfully compete for quality jobs and residents. In today’s economy, communities across the country are competing for talent and skilled workers to support the growth and workforce needs of existing and potential employers in the region. Fortunately, public, private, and non-profit leaders have come together around this process in an effort to improve Norman’s competitive position the economic well-being of its residents and businesses.

The remainder of this Assessment examines a wide variety of demographic, socioeconomic, economic, and quality of life indicators to tell a series of stories about the community that uncover the key strengths, weaknesses, assets, and challenges facing Norman today and in the years to come. These six stories are:

1. Changing Preferences and Regional Growth Patterns 2. Emerging Threats to Workforce Competitiveness 3. Economic Transition: Towards a More Innovative Economy 4. Public Education: Developing and Retaining Talent in Norman 5. Quality of Life in a University Town 6. Growth, Development, and Community Vision

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

1. CHANGING PREFERENCES AND REGIONAL GROWTH PATTERNS Population growth is perhaps the easiest way to begin discussing Norman’s competitive position. It is one of the most basic indicators that can be used to measure an area’s attractiveness as a place to live. In general, when speaking strictly from the perspective of residents, communities that are growing suggest that on some level, the city is a desirable place to live for one reason or another.

FIGURE 1: POPULATION GROWTH BY CITY (2006-2016) Net Change % Change 2006 2016 (’06-’16) (’06-’16) Norman, OK 105,552 122,180 16,628 15.8% Ann Arbor, MI 117,036 120,782 3,746 3.2% Boulder, CO 96,236 108,090 11,854 12.3% Lawrence, KS 85,155 95,358 10,203 12.0% Oklahoma City, OK MSA 1,182,668 1,373,211 190,543 16.1% United States 298,379,912 323,127,513 24,747,601 8.3% Source: United States Census Bureau, 2016 Population Estimates

Over the past several decades, the City of Norman has seen its population grow at a considerably faster pace than the average American community. Since 1970, Norman’s population has more than doubled while Cleveland County’s population has more than tripled, with both rates of growth far outpacing national and peer community averages. Over the past ten years, Norman has continued to grow faster than the national average. Its population grew by 15.8 percent between 2006 and 2016, outpacing growth in its benchmark cities – Ann Arbor, MI (3.2 percent); Boulder, CO (12.3 percent); and Lawrence, KS (12.0 percent).

FIGURE 2: POPULATION GROWTH BY COUNTY, OKLAHOMA CITY MSA (2006-2016) Net Change % Change 2006 2016 (’06-’16) (’06-’16) Cleveland County, OK 237,257 278,655 41,398 17.4% City of Norman, OK 105,552 122,180 16,628 15.8% Canadian County, OK 102,876 136,532 33,656 32.7% Grady County, OK 50,462 54,655 4,193 8.3% Lincoln County, OK 33,441 35,129 1,688 5.0% Logan County, OK 37,060 46,588 9,528 25.7% McClain County, OK 31,419 38,682 7,263 23.1% Oklahoma County, OK 690,153 782,970 92,817 13.4% Oklahoma City MSA 1,182,668 1,373,211 190,543 16.1% Source: United States Census Bureau, Population Estimates

While Norman’s recent growth has outpaced its peer communities across the country, its competitive position within the Oklahoma City region is changing. Part of Norman’s growth can be attributed to the simple fact that the region as a whole has been growing rapidly in recent years. Norman has grown at roughly the same pace as the greater Oklahoma City metro area over the past decade. Although Norman grew faster as compared to the benchmark cities, population growth in Cleveland County has trailed Canadian, McClain, Logan, and Oklahoma counties in the metro area in the most recent ten-year period (2006-2016). While

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma growth in Cleveland County and Norman outpaced neighboring counties and communities in the 1980s and 1990s, this dynamic began to change in the mid-2000s as these other suburban counties (Canadian, McClain, and Logan) and the region’s core county (Oklahoma) began to experience more rapid growth.

Overall, population change is influenced by two factors: natural change (births minus deaths) and net migration (both domestic and international). Net migration reflects the portion of population growth that is most closely tied to a community’s relative attractiveness and success in meeting the wants and needs of existing and prospective future residents. It speaks to an important component of a community’s ability to provide a sustainable workforce: its ability to attract and retain talent.

Data from the Internal Revenue Service (IRS) offers detailed insight into the migration trends facing communities – specifically, the top sources and destinations for domestic migrants to and from a given county. This data is compiled from anonymized tax return data. If a given return moves from one county to another between tax years, that return – and all its associated exemptions – is categorized as having migrated between counties. Examining the number of exemptions that move from county to county in a given year can provide a rough estimate of the net flow of actual people from place to place. (Note that because the data program depends on changes in county of residence between tax years, the data does not capture the majority of university students as most have never filed a tax return before.)

FIGURE 3: NET MIGRATION, CLEVELAND COUNTY, TOP SOURCES & DESTINATIONS (2004-2014)

Top Sources (Inmigrants > Outmigrants) Top Destinations (Outmigrants > Inmigrants)

Oklahoma County, OK +11,290 McClain County, OK -1,624 Comanche County, OK +867 Canadian County, OK -885 Pontotoc County, OK +451 Harris County, TX -601 Bay County, FL +393 Grady County, OK -534 Payne County, OK +362 Dallas County, TX -290 Los Angeles County, CA +308 Bexar County, TX -257 Garvin County, OK +302 King County, WA -244 Sedgwick County, KS +288 Travis County, TX -232 Jackson County, OK +286 Tarrant County, TX -208 Stephens County, OK +259 Montgomery County, TX -198 Source: Internal Revenue Services (IRS)

The data illustrate that the top net destinations for residents leaving Cleveland County include many major metropolitan areas and employment centers in Texas such as Houston (Harris and Montgomery); Dallas-Ft. Worth (Dallas and Tarrant); San Antonio (Bexar); and Austin (Travis). However, the top two destinations for out-migrants are actually other suburban counties in the region – McClain and Canadian counties.

The data show that Cleveland County’s domestic in-migration is largely fueled by new residents from many other surrounding and nearby counties in Oklahoma. Oklahoma County has been the dominant source of new residents to Cleveland County for decades. On average, Cleveland County had a net gain of roughly 1,100 new residents per year from Oklahoma County during the ten-year period beginning in 2004. However, this relationship has begun to change in recent years. IRS migration data is beginning to reflect

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma the anecdotal evidence collected from residents and stakeholders participating in the public input phase that the City of Norman is starting to lose residents to surrounding areas.

Input participants reported that Norman has historically been a desirable location to live in the metro area. And while this continues to be true, in recent years, stakeholders felt that Norman has begun to face stronger competition from other communities in the region, including the core (Oklahoma City) and other suburban communities. A variety of reasons for shifting preferences have been cited, including actual or perceived differences in housing cost and quality, amenities, public schools, and access to job opportunities.

FIGURE 4: ANNUAL NET MIGRATION, CLEVELAND COUNTY VS. OKLAHOMA COUNTY (2000-2014)

4,000

1,507 1,862 3,000 2,066

2,000

2,726

2,628

2,394

2,291

2,170

2,057

1,889 1,889

1,703

1,667

1,638

1,453 1,351

1,000 1,095

-

-

-

162

290

420

- -

0 -

847

-

-

1,275

1,349

1,417

1,452

-

-

2,206

2,325

-

- 2,968

-1,000 2,698

- 3,650

-2,000

-3,000

-4,000 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Cleveland County, OK Oklahoma County, OK

Source: Internal Revenue Service; Moody’s Analytics

While Cleveland County’s population growth has largely been attributed to strong domestic in-migration over the past decade, this growth has been fueled by residents moving from Oklahoma County to Cleveland County. Recent data shows a reversal in this trend. Beginning in 2013, the number of residents moving from Cleveland to Oklahoma County (out-migration) exceeded the number of residents moving from Oklahoma to Cleveland County (in-migrants) for the first time since the IRS started publishing the migration data in 1990. This trend accelerated in 2014 and it will be important for community leaders to continue to monitor migration data in the years to come. There is no greater threat to the community’s economic, workforce, and fiscal sustainability than potentially persistent net out-migration.

However alarming, the aforementioned trends are not unique to Norman. In fact, they are consistent with national trends that show an influx of people moving from suburbs back into cities and the urban core districts of metropolitan areas. This trend has been widely documented in recent years with much of the conversation centering on the divergent preferences of Millennials and Baby Boomers.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

In 2015, the Urban Land Institute surveyed 1,202 adults to determine the types of environments in which they prefer to live and the community attributes with which they wish to surround themselves. The results of reinforced what many have observed in recent years: that population trends around the country are increasingly influenced by the location preferences of Millennials as they age into the workforce and start their careers. While the majority of Baby Boomers prefer to live in rural areas and small towns (51 percent), less than one-third of Millennials (32 percent) prefer such an environment. Meanwhile, 37 percent of Millennials prefer to live in cities as compared to just 22 percent of Baby Boomers and 28 percent of Gen X.

FIGURE 5: RESIDENTIAL LOCATION PREFERENCES BY GENERATION, UNITED STATES (2015) Baby Boomers Millennials

(ages 50-68) (ages 18-36) Desired Residential Location (% who would like to live in a certain community type) Rural areas and/or small towns 51% 32% Suburbs 24% 29% Cities 22% 37% Priorities When Choosing a Place to Live (% top or high priority) Convenient public transit 29% 39% Walkability 50% 54% Space between neighbors 57% 50% Preferences for Specific Community Attributes (% agree) Prefer to live in a place where they do not need to use a car often 49% 63% Prefer to live in a diverse community w/ a mix of cultures and backgrounds 61% 76%

Source: Urban Land Institute (ULI)

As these preferences have become evident in migration and population trends around the country, many have suggested that Millennials will simply age into similar preferences as Boomers over time. The logic often follows that Millennials have been “slowed down” by the Great Recession and/or are deciding to start families later. It theorizes that Millennials will be equally attracted to lower-density, single-family development patterns that are found outside of cities, along with a desire to seek out stronger public school systems, lower crime neighborhoods, and other attributes that are – in general – more common in suburbs outside of core cities. By examining the changes in survey results between 2013 and 2015, we can help determine if Millennial location preferences are in fact evolving in this way.

Between 2013 and 2015, the percentage of Millennials that indicated they preferred to live in a suburb surged from 20 percent to 29 percent. But this growth came at the expense of rural areas and small towns rather than cities; the percentage that preferred to live in a city remained constant at 37 percent. And so, the implications of these survey results are clear: Millennials increasingly prefer urban amenities and access, and are willing to locate in both cities and suburbs that offer these amenities and access. While there are certainly exceptions, suburbs that offer these attributes will be better positioned for Millennial talent than those that do not. This Assessment will examine these attributes and others influencing quality of life and quality of place in a subsequent chapter. Before doing so, it is important to first examine and understand the manner in which these migration trends and other underlying socioeconomic attributes characterize and influence the community’s workforce competitiveness.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

2. EMERGING THREATS TO WORKFORCE COMPETITIVENESS The preceding story established that the Norman area – and more specifically, Cleveland County – has been subjected to changing preferences among existing and prospective new residents that are influencing migration dynamics and population growth trends. A decomposition of population growth by various attributes – notably age and educational attainment – and an examination of the characteristics of in- migrants to Norman will offer further insight into the changes facing the community and their implications for workforce competitiveness.

The University of Oklahoma’s (OU) presence is without a doubt the single largest magnet for new residents to the city, with thousands of young adults moving to Norman each year to begin their studies at OU. Although thousands of young adults move to Norman for OU, a similar number of students graduate each year, and both qualitative and quantitative data indicates that Norman loses many of those graduates to other communities. A 2016 survey of 300 OU students found that only three percent of students surveyed indicated they would definitely stay in Norman after graduating, while 46 percent indicated that they definitely would not live in Norman after graduation.i The remaining 48 percent of surveyed students indicated that they would consider living in Norman but would also consider living elsewhere.

These sentiments reinforce fears that emerged in the public input phase. Community leaders, business owners, and residents at-large are concerned that the community is not effectively retaining talent at all ages and skill levels, not simply college graduates. And as previously illustrated, these fears are becoming realities; net outmigration has characterized the area in recent years, reflecting the first in a series of potentially concerning trends with respect to workforce competitiveness.

The second emerging threat to the community’s potential workforce stainability and long-term competitiveness is its changing age distribution. As of 2016, Norman’s age distribution is similar to its comparison communities with a relatively large share of college-age residents. Beyond that, roughly half of Norman residents are between the ages of 25 and 64, which represents the prime-age workforce. Many communities are faced with declining prime age workers and have significant workforce sustainability concerns. As Baby Boomers begin to retire, concerns over the quantity of workers available in a region grows. Within prime-age workers, the ratio of residents aged 25 to 44 to those aged 45 to 64 can be used as a rough estimate to gauge the sustainability of a community’s workforce over time. A ratio of greater than 1.0 indicates that a community will have enough younger workers to replace more experienced workers as they approach retirement age. Nationally, the share of workers aged 25 to 44 (26.3 percent) is roughly the same size as the share of the population between the ages of 45 and 65 that are expected to retire over the coming decades (producing a “dependency ratio” of 1.01).

In Norman, the dependency ratio is 1.17, suggesting there will be enough available workers to support the region’s existing economic activities (regionally, the ratio is 1.15 across the Oklahoma City metro area). However, in its benchmark communities, the ratio is much higher. Ann Arbor (1.49), Boulder (1.38), and Lawrence (1.38) all have much more favorable age dynamics whereby their population aged 25-44 is considerably larger than the population aged 45-64. In this regard, these other communities are better positioned to replace older, more experienced workers as they exit the workforce. And so, while this litmus test suggests that Norman has a reasonably sustainable workforce, the relative size of this advantage trails its competitors and further, the data suggests that this advantage is eroding.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

FIGURE 6: AGE DISTRIBUTION (2016) 100% 9.8% 9.6% 13.5% 11.5% 13.2% 15.2% 90% 65+

80% 17.6% 20.3% 17.6% 21.4% 24.1% 26.1% 70% 45-64

60% 27.3% 26.3% 28.0% 25.1% 50% 27.7% 25-44 26.3% 40% 17.4% 21.4% 15.5% 19.8% 7.4% 20-24 30% 6.9%

20% 28.0% 27.6% 25.5% 0-19 10% 24.5% 23.2% 22.1%

0% Norman, OK Ann Arbor, MI Boulder, CO Lawrence, KS OKC MSA United States

Source: United States Census Bureau, ACS 1-Year Estimates

Norman is aging faster than its peer communities, the metro, and the United States. Norman’s population over the age of 65 increased by 35 percent between 2011 and 2016. While all communities experienced growth within the age group, the share of the population over the age of 65 in Norman increased by 2.7 percentage points, indicating a significant shift in the age distribution. What is most alarming, however, is that the population aged 25-44 actually declined, in absolute terms and as a percentage of the total population. Given that Norman’s age distribution already skews slightly older than its benchmark communities, these trends within the younger cohort of prime-age workers could put the community at a competitive disadvantage. Between 2011 and 2016, prime-age workers (25-64) represented just 19 percent of all population growth in Norman as compared to 42 percent regionally and 37 percent nationwide. The result: a community whose demographic sustainability is threatened and eroding quickly.

FIGURE 7: PERCENTAGE POINT CHANGE IN AGE DISTRIBUTION (2011-2016)

0-19 20-24 25-34 35-44 45-64 65+ Norman, OK -1.3% 0.7% -1.5% -1.9% 1.2% 2.7% Ann Arbor, MI 1.4% 1.3% -2.3% 1.2% -2.5% 0.9% Boulder, CO 0.4% -1.3% 0.9% -0.2% -1.2% 1.4% Lawrence, KS 3.9% -5.8% -0.6% -0.2% 0.7% 1.9% Oklahoma City MSA -0.2% -0.3% 0.0% 0.1% -0.9% 1.3% United States -1.1% -0.2% 0.4% -0.5% -0.5% 1.9% Source: United States Census Bureau, ACS 1-Year Estimates

Beyond age dynamics, the characteristics of in-migrants to the community offer further insight to how Norman is changing. Educational attainment rates are often used as the most basic measure to gauge the quality of a region’s workforce. In order to compete for high quality jobs communities must boast a well-

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma educated workforce to support such employment opportunities. This is true for both business expansion needs and for business attraction considerations. Companies and site selectors often use educational attainment rates to screen communities and evaluate talent pools at a high level.

FIGURE 8: EDUCATIONAL ATTAINMENT OF RESIDENTS AGE 25+ (2016) 100% 10.3% 11.9% 90% 17.1% 25.5% 38.5% 80% 19.5% 19.3% 48.7% 70% 25.4%

60% 31.6% 31.8% 29.0% 50% 34.5% 40% 31.5% 27.8% 30% 23.2% 26.9% 27.2% 20% 15.3% 18.8% 14.7% 10% 14.8% 8.1% 11.6% 12.5% 7.2% 6.4% 0% 4.9% Norman, OK Ann Arbor, MI Boulder, CO Lawrence, KS OKC MSA United States

No high school diploma High school diploma or equivalency Some college or Associate degree Bachelor's degree Graduate degree

Source: United States Census Bureau, ACS 1-Year Estimates

Roughly 43 percent of adult residents in Norman have a bachelor’s degree or higher, considerably higher than the regional (30 percent) and national (31.3 percent) averages. But as a community that is home to a large university, Norman’s educational attainment rates are surprisingly low relative to its peers. Roughly seven out of ten residents in Ann Arbor (76.5 percent) and Boulder (73 percent) had a bachelor’s degree or higher. In Lawrence, 57.1 percent of residents have a four-year degree or higher. This is a tremendous gap relative to these other communities, one that reflects significant differences in current economic composition and potential future economic development.

And unfortunately, two different trends indicate that the educational attainment gap between Norman and its competitors has grown and may continue to grow in the future. Over the past five years, the percentage of adults with a bachelor’s degree or higher fell by 1.7 percentage points in Norman. At the same time, Ann Arbor (+5.8 percentage points), Lawrence (+4.9), the Oklahoma City MSA (+1.6) and the U.S. (+2.8) all saw their share of the population with a bachelor’s degree or higher increase. Boulder also experienced a decline in its share of highly educated residents (-3.2 percentage points). Meanwhile, the percentage of adults with no high school diploma grew by 2.0 percentage points while declining by 1.6 percentage points across the average American community.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

FIGURE 9: CHANGE IN EDUCATIONAL ATTAINMENT OF RESIDENTS AGE 25+ (2011-2016)

No high school diploma Bachelor's degree or higher Change Change 2011 2016 2011 2016 (’11-’16) (’11-’16) Norman, OK 5.2% 7.2% 2.0% 44.3% 42.6% -1.7% Ann Arbor, MI 4.6% 2.4% -2.2% 70.7% 76.5% 5.8% Boulder, CO 3.2% 3.6% 0.4% 76.2% 73.0% -3.2% Lawrence, KS 4.4% 4.9% 0.5% 52.2% 57.1% 4.9% Oklahoma City MSA 12.5% 11.6% -0.9% 28.2% 29.8% 1.6% United States 14.1% 12.5% -1.6% 28.5% 31.3% 2.8%

Source: United States Census Bureau, ACS 1-Year Estimates

A portion of this change in educational attainment rates can be attributed to differences in the attainment levels of in-migrants relative to existing residents. According to Census Bureau figures, in-migrants to Norman over the last five years (38.5 percent BA+) are not only considerably less educated than their migrant counterparts to peer communities, they are actually less well educated than Norman’s existing residents (42.6 percent BA+). In-migrants to Ann Arbor and Lawrence are contributing to rising educational attainment rates for these communities, while in-migrants to Norman and Boulder are contributing to declining educational attainment rates. Although existing residents can certainly enhance their skills by enrolling in higher education, simply put, Norman will struggle to realize its vision for a more prosperous and innovative economy if it fails to create a more compelling value proposition for highly educated prospective residents.

FIGURE 10: EDUCATIONAL ATTAINMENT OF IN-MIGRANTS AGE 25+ (2011-2015 5-YEAR AVERAGE)

100% 9.6% 14.1% 90% 16.0% 30.3% 80% 38.0% 34.4% 19.3% 22.1% 70% 22.5%

60% 29.2% 32.5% 50% 35.0% 28.5% 40% 38.4% 41.1%

30% 20.2% 26.1% 23.3% 20% 19.6% 15.6% 12.8% 14.4% 10% 9.3% 12.5% 12.0% 7.5% 7.2% 5.9% 0% Norman, OK Ann Arbor, MI Boulder, CO Lawrence, KS OKC MSA United States No high school diploma High school diploma or equivalency Some college or Associate degree Bachelor's degree Graduate degree

Source: United States Census Bureau, 2011-2015 ACS 5-Year Estimates

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

And so, four troubling trends have been observed in recent years that threaten Norman’s historical success as a growing, prosperous community of choice within the Oklahoma City metropolitan area:

1. Net out-migration 2. Declining population aged 25-44 3. Declining educational attainment levels 4. In-migrants that are less well educated than existing residents

While this section has focused on the implications of certain trends on workforce sustainability, these trends in educational attainment also have clear implications for the types of economic activity that the community can support, and the level of economic prosperity that residents will enjoy. A wealth of research has demonstrated the connection between one’s educational attainment and their lifetime earning potential. Individuals with higher levels of education are, not surprisingly, more likely to have higher incomes and less likely to be unemployed. Higher levels of education have also been tied to lower incarceration rates and higher levels of volunteering, among other positive outcomes. Communities with higher levels of education are therefore more likely to benefit from increased wealth and overall prosperity for their residents.

FIGURE 11: UNEMPLOYMENT & EARNINGS BY EDUCATIONAL ATTAINMENT, UNITED STATES (2016) $100,000 8%

$90,000 7% $90,740 $80,000 $86,528 6% $70,000 $71,760 5% $60,000 $60,112 $50,000 4%

$40,000 $42,588 3%

$39,312 Rate Unemployment Median Annual Annual Median Earnings $30,000 $35,984 2% $20,000 $26,208 1% $10,000

$0 0% No high High school Some Associate's Bachelor's Master's Professional Doctoral school diploma college degree degree degree degree degree diploma Median annual earnings Unemployment rate

Source: Bureau of Labor Statistics Note: Data are for persons age 25 and over. Earnings are for full-time wage and salary workers.

Indeed, this relationship can be seen in the household incomes of Norman’s population relative to its peers. In 2016, the median household income in Norman was $52,041, the lowest among the benchmark communities. Nationally, the median household income was $57,617.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

FIGURE 12: HOUSEHOLD INCOME DISTRIBUTION & MEDIAN HOUSEHOLD INCOME (2016) 100% $80,000 8.2% 9.4% 9.7% 16.3% 21.9% 12.2% 90% $70,000 12.1% 13.4% 12.7% 80% 14.8% 14.0% 12.4% 13.1% $60,000 70% 14.0% 10.0% 12.3% 60% 12.6% $50,000 19.3% 11.2% 19.6% 19.0% 17.7% 50% 13.4% $40,000 13.1% 40% 22.4% $30,000 23.9% 23.9% 30% 19.9% 16.8% 22.5% $20,000

20% IncomeHousehold Median Household Distribution IncomeHousehold 10% 24.0% 22.9% 22.9% 25.0% 21.7% 21.2% $10,000 0% $0 Norman, OK Ann Arbor, MI Boulder, CO Lawrence, KS OKC MSA United States Less than $25,0000 $25,000 to $49,999 $50,000 to $74,999 $75,000 to $99,999 $100,000 to $150,000 $150,000 or more Median income (dollars) Source: United States Census Bureau, ACS 1-Year Estimates

Additionally, growth in median household income and changes in the household income distribution reflect some of the aforementioned trends and stakeholder observations, notably those related to out-migration and educational attainment. In Norman, median household income increased by just 8.8 between 2011 and 2016 while growing by nearly twice this rate (17.1 percent) across the Oklahoma City metro area. During this time period the rate of inflation nationwide was 7.6 percent, indicating that the median household is only marginally better off when inflation is taken into account. Trends in the household income distribution show that this sluggish growth can be attributed in part to the relative lack of growth in households at the top end of income spectrum in Norman, and a relative lack of progress in elevating households from the lower end. However, data covering the adjusted gross income of migrants illustrates that there isn’t a substantive difference in the AGI of in-migrants and out-migrants.

FIGURE 13: PERCENTAGE POINT CHANGE IN HOUSEHOLD INCOME DISTRIBUTION (2011-2016) Less than $25,000 to $50,000 to $75,000 to $100,000 to $150,000 or

$25,000 $49,999 $74,999 $99,999 $150,000 more Norman, OK -1.7% -2.9% 3.1% 0.7% 1.2% -0.5% Ann Arbor, MI -5.6% -2.5% -1.5% 4.1% 1.4% 3.8% Boulder, CO -2.1% -1.4% -1.9% 1.8% 2.4% 1.2% Lawrence, KS -2.4% -6.3% 2.3% -0.2% 2.4% 4.0% OKC MSA -4.6% -2.4% 0.3% 1.3% 1.8% 3.7% United States -3.8% -2.0% -0.3% 0.6% 1.9% 3.5% Source: United States Census Bureau, ACS 1-Year Estimates

Combined, these data points suggest that Norman’s ability to elevate individual and collective standards of living is threatened. In the end, this is the purpose of economic development: to elevate standards of living. But these trends also have important consequences for the city’s workforce sustainability, as well as its economy, tax base, and future competitiveness as a place to do business.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

3. ECONOMIC TRANSITION: TOWARDS A MORE INNOVATIVE ECONOMY Overall, the age dynamics and educational attainment rates of residents have important implications on the types of jobs that a community can support and the economic opportunities available for its workforce. Certainly, when a community is located in a metro region, the lines between communities can become a bit blurry. The ability for workers and residents to choose a community to live in that is different than the city where they work can make things more challenging. Yet, prosperous and thriving communities are those that offer residents quality jobs in a desirable community, and age dynamics and educational attainment rates are major factors that will influence such economic opportunities. These influences work both ways, and if a community does not have good, quality jobs available, it will continue to lose educated workers to other communities that are able offer the types of employment opportunities that these individuals seek. Furthermore, as evidenced by the ULI survey data and other research at the national level, residential location preferences are changing along generational lines, with younger workers (in aggregate) demonstrating a preference for greater proximity between their place of work and place of residence.

FIGURE 14: RATIO OF JOBS TO EMPLOYED RESIDENTS (2006-2016) NUMBER OF EMPLOYED RATIO: JOBS TO NUMBER OF JOBS RESIDENTS EMPLOYED RESIDENTS

Change Change Change 2006 2016 (’06-’16) 2006 2016 (’06-’16) 2006 2016 (’06-’16) Norman, OK 59,185 62,725 3,540 52,707 58,844 6,137 1.12 1.07 (0.06) Ann Arbor, MI 160,112 173,538 13,426 62,109 61,571 (538) 2.58 2.82 0.24 Boulder, CO 100,173 113,421 13,248 58,326 60,284 1,958 1.72 1.88 0.16 Lawrence, KS 50,271 52,521 2,250 48,411 50,568 2,157 1.04 1.04 0.00 OKC MSA 627,903 668,091 40,188 545,560 638,012 92,452 1.15 1.05 (0.10)

Source: Economic Modeling Specialists International (EMSI); Bureau of Labor Statistics Zip code level data has been used to derive city-level estimates for Norman and all comparison areas. The following zip codes were included in the estimate for Norman: 73019, 73026, 73069, 73070, 73071, 73072, 73068.

Overall, unlike Ann Arbor and Boulder, Norman is not a major job center. The ratio of jobs (number of people working in the city) to employed residents living in Norman is 1.07, indicating that there is slightly more than one job for every one worker (or rather, 107 jobs for every 100 employed residents). In comparison, Ann Arbor’s jobs to worker ratio is 2.82 while Boulder’s ratio is a 1.88. These ratios in Boulder and Ann Arbor illustrate that those cities have high concentration of jobs and accordingly, a high rate of commuting inflow from non-residents to support these jobs. Over the course of the last ten years, Norman has actually become less of a job center: the number of employed residents grew more rapidly than the number of jobs. The data illustrate that this trend is waning, however, as the pace of resident employment growth has slowed in the last few years (consistent with other observed trends referenced in the preceding section). But overall, the community is remarkably balanced in terms of its status as a residential center and an employment center. Perhaps no indicator more clearly illustrates the differences in the relative economies of these four “university towns.” Ann Arbor and Boulder are clearly regional employment centers that – as will be illustrated in this section – have effectively leveraged their university’s research expenditure and talent production to support a more abundant, diverse set of job opportunities. In this regard, they reflect the more innovative economies that so many residents and community leaders expressed as their economic

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma vision for Norman: an economy that effectively leverages its university and talent pool, as opposed to an economy that primarily services and is relatively dependent upon its university and talent pool.

Although many residents and stakeholders expressed concern regarding the community’s recent competitiveness and relative success with respect to job creation, the data illustrate that private sector job growth in Norman (18.0 percent) actually far outpaced its peers, was more than double the regional rate of growth (8.3 percent), and more than three times the national rate of private sector job growth (5.6 percent). This is a remarkably positive finding, one that should encourage community leaders and residents. It is noteworthy that this growth spanned a period of time that included our nation’s most severe economic recession since the Great Depression. It also coincided with a time period of economic recovery in which private sector investment in many metropolitan areas began to flow more heavily to core cities that offered the amenities and attributes that young talent is seeking. Employment growth in the private sector is a positive finding and is supportive of input received regarding Norman’s preferred economic future.

FIGURE 15: PRIVATE SECTOR AND PUBLIC SECTOR EMPLOYMENT (2006-2016)

Private Sector Jobs Public Sector Jobs Net % Net % 2006 2016 Change Change 2006 2016 Change Change (’06-’16) (’06-’16) (’06-’16) (’06-’16) Norman, OK 38,700 45,682 6,982 18.0% 20,485 17,043 (3,442) -16.8% Ann Arbor, MI 96,236 94,371 (1,865) -1.9% 63,876 79,167 15,291 23.9% Boulder, CO 81,101 89,715 8,614 10.6% 19,072 23,706 4,634 24.3% Lawrence, KS 37,595 38,240 646 1.7% 12,676 14,281 1,604 12.7% Oklahoma City MSA 496,183 537,096 40,913 8.3% 131,720 130,995 (725) -0.6% United States 127m 134m 7.2m 5.6% 24.0m 24.4m 361k 1.5%

Source: Economic Modeling Specialists International (EMSI) Zip code level data has been used to derive city-level estimates of jobs for Norman and all comparison areas. The following zip codes were included in the estimate for Norman: 73019, 73026, 73069, 73070, 73071, 73072, 73068.

While private sector job growth is encouraging, public sector employment declined drastically in the community. Combined, these trends in the public and private sector resulted in an economy that is considerably less reliant on government employment today than it was just ten years ago; in fact, the public sector’s share of employment has declined from 35 percent in 2006 to just 27 percent as of 2016. Nonetheless, the community remains relatively dependent upon government as compared to the average American community (15.3 percent of employment in the public sector). Such a high dependency on the public sector leaves the city vulnerable to government budget cuts and changes in spending at the local, state, and federal level. Oklahoma, more so than other states, understands this reality, especially when it comes to education funding. Declining oil revenue along with the aftermath of the Great Recession has continued to strain the Oklahoma state budget. In response to budgetary constraints, the state made significant cuts to education funding, forcing educational institutions to cut jobs and leave vacant positions unfilled in an effort to reduce payroll expenses. As a result, government employment has suffered significant losses. In Norman, public sector employment declined by nearly 3,500 jobs between 2006 and 2016.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

The forthcoming Target Sector Analysis will examine private sector economic composition in detail, analyzing job growth and other factors in hundreds of detailed subsectors. The accompanying table provides a high- level overview of economic composition by examining just a few major sectors of the economy. It is sorted by the total number of jobs in each of Norman’s business sectors, from largest to smallest. The first column displays the “location quotient” or “LQ,” a statistic that measures how concentrated a given sector is in a local economy relative to the national average. A location quotient of 1.0 indicates that a sector is exactly as concentrated in the local economy as it is nationally (as measured by its share of total employment). A location quotient well above 1.0 could imply that a region offers some form of competitive advantage to businesses in that sector sufficient to support agglomeration or “clustering.”

FIGURE 16: ECONOMIC COMPOSITION (2006-2016) UNITED NORMAN, OKLAHOMA STATES LQ Jobs Net Change % Change % Change Business Sector (2016) (2016) (’06-’16) (’06-’16) (’06-’16) Government 1.77 17,043 (3,442) -16.8% 1.5% Retail Trade 1.33 8,631 2,616 43.5% 1.8% Accommodation & Food Services 1.44 7,721 1,835 31.2% 19.1% Health Care & Social Assistance 0.74 5,799 1,506 35.1% 25.4% Professional, Scientific, & Tech. Services 1.01 4,063 1,068 35.7% 17.6% Admin., Support & Waste Mgmt. Services 0.80 3,143 (1,114) -26.2% 7.3% Other Services (except Public Admin.) 1.04 3,124 187 6.4% 3.1% Construction 0.83 2,796 (12) -0.4% -14.9% Manufacturing 0.55 2,748 (150) -5.2% -12.9% Finance & Insurance 0.67 1,640 (41) -2.5% -3.8% Real Estate & Rental & Leasing 1.18 1,214 (26) -2.1% -5.7% Arts, Entertainment, & Recreation 0.88 940 478 103.7% 16.5% Wholesale Trade 0.39 933 242 35.0% -1.3% Information 0.61 715 43 6.4% -7.7% Educational Services 0.33 538 4 0.8% 25.9% Transportation & Warehousing 0.24 527 63 13.5% 12.1% Mining, Quarrying, Oil & Gas Extraction 1.65 411 192 87.3% -0.6% Mgmt. of Companies & Enterprises 0.34 298 117 64.8% 24.9% Utilities 1.04 230 (25) -9.8% 2.3% Crop & Animal Production 0.27 210 25 13.7% 0.7% Total Jobs, All Sectors 62,725 3,566 6.0% 5.0% Source: Economic Modeling Specialists International (EMSI) Location quotients (LQs) are a ratio of the region’s share of jobs in a given sector divided by that same sector’s share of total jobs nationwide. Zip code level data has been used to derive city-level estimates of jobs for Norman and all comparison areas. The following zip codes were included in the estimate for Norman: 73019, 73026, 73069, 73070, 73071, 73072, 73068.

Not surprisingly, the community’s largest sector is government. Private sector employment growth has largely been fueled by job growth in retail trade; accommodation and food services; health care and social assistance; and professional, scientific, and technical services. In total, these four sectors added more than 7,000 jobs between 2006 and 2016. Further, growth within each of the sectors far outpaced the national average. However, most of these sectors are traditionally “local-serving.” In general, the retail trade, food

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma services, and health care sectors are largely supported by nearby residents. As such, they do not bring much new money into the region; that is to say, they are not “export-oriented.” Rather, they tend to primarily recirculate money in the local economy. These business operations primarily serve the local and region population given that most people tend to shop and dine at establishments near where they live. In addition to being primarily local-serving and having limited growth opportunities, jobs within these sectors tend to be lower skilled and provide lower wages. In 2016, the average wage for workers in retail trade was $27,498, while workers in accommodation and food services had an average wage of $15,690. In comparison, the average wage for all jobs in Norman was $38,082.

Yet, when it comes to employment opportunities that will help increase wealth and prosperity, Norman has a lower concentration of jobs in sectors that are export-oriented and those that pay higher wages. Export- oriented sectors include sectors such as manufacturing and finance, which bring new wealth into the community by selling goods and services to businesses and consumers beyond the immediate area. In 2016, average earnings for manufacturing jobs in Norman was $56,181, while finance and insurance jobs had an average earnings of $51,202. However, data show that employment within many of these higher-paying, export-oriented sectors is less concentrated than the national average.

Norman’s economic composition is partially a reflection of its lower educational attainment rates. Norman has a lower concentration of jobs in even the traditional white collar jobs that are typically found in university towns, such as information services. Economic activity in this sector and others like it is typically much more robust around research universities. The location quotient for the information sector in Norman is just 0.61. In comparison, jobs in information are highly concentrated in Boulder; its location quotient was 2.67. In Ann Arbor, the information sector’s location quotient was 1.11, while it was just 0.84 in Lawrence.

Professional, scientific, and technical services has experienced rapid growth in Norman over the past decade. Between 2006 and 2016, the city added more than 1,000 jobs within this sector and employment grew by 35.7 percent. Its growth rate was roughly double that of the nation’s. Yet, even with such rapid growth, the concentration of jobs in professional, scientific, and technical services was roughly equivalent to the national average in 2016. As with the information sector, Norman’s location quotient was much lower than its comparison cities of Ann Arbor (LQ=1.30), Boulder (2.91), and Lawrence (1.22). Despite having a lower concentration of jobs compared to the benchmark communities, the rapid job growth in professional services over the past decade is a positive finding and is a clear few bright spot in Norman’s economic story. The same is true for observed growth in the arts, entertainment, and recreation sector. This can reasonably be interpreted as a sign of growing capacity in an area that is highly connected to amenities, culture, and quality of life offerings that influence residential location – and increasingly business location – decisions.

Although much of the private sector job growth was in locally-serving and lower-paying sectors, growth in professional, scientific, and technical services is also encouraging as these new opportunities can expand wealth and raise standards of living. In Norman, average earnings in professional services were roughly 40 percent higher than the city’s overall average earnings. And indeed, growth in the professional services and health care sectors is fueling average wage growth across the region, sufficient to overcome the downward pressure on average wages born from growth in lower wage sectors such as retail and food service. Wages grew by 16.1 percent between 2011 and 2016. In the Oklahoma City metro area, average wages increased by 10.0 percent, while nationally, wages increased by 11.4 percent. Although the average wage in Norman

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma trails its comparison communities, the Oklahoma City metro area, and the nation, recent wage and earnings growth demonstrates that it is gaining ground. However, this positive finding with respect to wage growth must be considered alongside other trends observed for the resident population. Recall that wages are earned and reported based on place of establishment; that is to say, wages and earnings data captures many non-residents that are commuting into the region for work. Recalling that household income growth has been relatively sluggish in Norman and the educational attainment levels of residents have deteriorated, it is plausible that much of the lower-wage job growth in Norman is being captured by Norman residents, whereas much of the higher-wage job growth is being filled by non-residents that are commuting to Norman.

FIGURE 17: AVERAGE WAGES, SALARIES, AND PROPRIETOR EARNINGS (2016) AVERAGE ANNUAL EARNINGS EARNINGS AS A % OF U.S. AVERAGE % Change Change 2011 2016 2011 2016 (’11-’16) (’11-’16) Norman, OK $32,801 $38,082 16.1% 71.6% 74.6% +3.0% Ann Arbor, MI $45,155 $51,014 13.0% 98.5% 99.9% +1.4% Boulder, CO $52,804 $59,655 13.0% 115.2% 116.8% +1.6% Lawrence, KS $33,050 $36,296 9.8% 72.1% 71.1% -1.0% Oklahoma City MSA $40,645 $44,699 10.0% 88.7% 87.5% -1.1% United States $45,841 $51,064 11.4% - - -

Source: Economic Modeling Specialists International (EMSI)

Wage rates are a double-edged sword in economic development. On one hand, relatively high wage rates are often a reflection of a highly educated, skilled, and/or productive workforce. On the other hand, they reflect a key business cost and exorbitant wage rates can deter some employers that have particularly labor- intensive operations. Survey respondents who self-identified as a business owner, executive, or manager were asked to answer a series of questions related to Norman’s overall business climate, including questions related to labor costs. These survey respondents were asked to rate the degree to which each attribute was an advantage of disadvantage to existing and prospective new businesses in Norman.

FIGURE 18: LABOR PRODUCTIVITY AND LABOR COSTS (2016) Average Labor Productivity Average Labor Cost Return on Labor

(Regional Output/Jobs) (Total Earnings/Jobs) (Productivity/Cost) Norman, OK $94,457 $45,912 2.06 Ann Arbor, MI $96,503 $57,453 1.68 Boulder, CO $117,556 $69,722 1.69 Lawrence, KS $66,327 $34,703 1.91 Oklahoma City, OK MSA $119,210 $64,028 1.86 United States $117,350 $67,832 1.73 Source: Economic Modeling Specialists International (EMSI)

Roughly half of survey respondents felt that the cost of labor in Norman was an advantage or major advantage to the existing and prospective new businesses, while just seven percent felt that they were a disadvantage or major disadvantage. These positive evaluations may in part reflect another clear strength

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma for the Norman economy: the return on labor received by the average employer. Labor productivity is a standard measure of output per employee. Labor cost is a standard measure of wages paid per employee. By examining the ratio of the two concepts, we can determine the average return on labor investment in a given community. In Norman, the ratio of productivity to cost is 2.06, considerably higher than the average American community (1.73) and higher than all comparison areas including the metropolitan average (1.86). In other words, on average, for every dollar spent on employee earnings (wages, salaries, benefits, and other compensation), there is $2.06 in output (as measured by gross regional product).

Certain survey findings seem to conflict with some of the input received via interviews and focus groups, as well as comments on other portions of the survey. An impressive 82.5 percent of respondents felt that the interstate accessibility was a major advantage or advantage to Norman’s business climate. The community has direct access to just one interstate (35) but is proximate to Interstates 40 and 44. These high evaluations likely reflect this regional proximity as direct access to a single interstate is not a marketable differentiator.

FIGURE 19: SURVEY QUESTION: “PLEASE RATE THE FOLLOWING ELEMENTS OF NORMAN'S BUSINESS CLIMATE ACCORDING TO THE DEGREE TO WHICH EACH IS AN ADVANTAGE OR DISADVANTAGE TO EXISTING AND PROSPECTIVE NEW BUSINESSES.” Interstate accessibility 13% 82% Cost of labor 7% 45% 48% Availability of industrial land for development 13% 38% 49% Availability of water and sewer 13% 39% 47% Availability of quality office space 16% 35% 49% Roadway connectivity and capacity 25% 26% 50% Availability of skilled labor 19% 35% 46% Availability of high-speed internet 23% 30% 47% Cost of utilities 17% 54% 29% Local taxes 26% 52% 22% Affordability of passenger air travel 29% 49% 22% Passenger air connectivity 33% 40% 26% Provision of economic incentives 34% 43% 23% Cost of health care 31% 48% 20% Code enforcement 47% 38% 15% Cost of permit acquisition 53% 36% 11% Ease and speed of permit review process 62% 26% 12%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Major disadvantage or disadvantage Neutral Major advantage or advantage

Source: Market Street Services; Norman Strategic Plan for Economic Development Survey (2017) Question was presented to 364 survey respondents that self-identified as owners, executives, or managers at their place of employment.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

Perhaps even more surprising is the relatively favorable rating given to roadway connectivity and capacity; 50 percent indicated that it was an advantage to some degree while just 25 percent indicated that it was a disadvantage. This positive evaluation is a bit surprising given the frequency with which residents made comments about traffic congestion, poor roadway connectivity, and difficulty getting across town on the online survey. In fact, roadway connectivity was one of the most common challenges cited in an open-ended questions about the community’s weaknesses. It is possible that most of these respondents were expressing their dissatisfaction as commuters and residents whereas executives and business owners responding to the business climate questions evaluated roadway connectivity more favorably in the context of moving goods.

That said, any real or perceived competitive advantages in transportation infrastructure simply aren’t reflected in Norman’s economy. More so than other sectors, business in transportation and warehousing require a good location and connectivity in order to keep its business costs low. Interestingly, there are just over 500 jobs in this sector and its concentration is roughly a quarter that of the national average.

Survey respondents from the business community also felt that Norman has an advantage when it comes to the availability of industrial land for development and quality office space. This also seems to conflict with input from economic development practitioners and some members of the development community who cite a lack of industrial sites that are 50 acres or larger as a key impediment to manufacturing and distribution growth in the community. Survey respondents also evaluated water and sewer capacity favorably whereas many interviewees suggested that stormwater management was a clear priority for the community, needed to support continued economic development and the preservation of natural amenities (Lake Thunderbird).

The area of clear consensus between in-person input participants (interviewees and focus group participants) and survey respondents is in their evaluations of the cost of building permit acquisition and the ease and speed of permit review process. These were the two least-favorably rated aspects of the business climate out of 17 factors provided for evaluation. Although it is not uncommon for permit costs and times to be among the least favorably rated aspects of a community’s business climate on such a survey, conversations with interviewees and focus group participants dwelled on this subject. It is explored in greater detail in the final chapter to this Assessment.

FIGURE 20: SURVEY QUESTION: “PLEASE INDICATE THE DEGREE TO WHICH YOU BELIEVE THAT THE COMMUNITY HAS BEEN SUCCESSFUL IN THE FOLLOWING AREAS:” Marketing the community to potential visitors (travelers and tourists) 15% 45% 41% Developing a sustainable, skilled workforce 17% 45% 37% Marketing the community to prospective new residents and workers… 23% 47% 31% Marketing the community to businesses considering relocation 28% 44% 28% Keeping business costs competitive with surrounding areas 31% 34% 34% Providing necessary assistance to entrepreneurs and small businesses 33% 45% 22% Helping existing businesses overcome barriers to growth and expansion 43% 37% 20%

0% 20% 40% 60% 80% 100%

Very unsuccessful or unsuccessful Average Very successful or successful Source: Market Street Services; Norman Strategic Plan for Economic Development Survey (2017) Question was presented to 364 survey respondents that self-identified as owners, executives, or managers at their place of employment.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

Overall, a prevailing sentiment and generalization emerged from conversations with business owners and developers in the Norman area: Norman is not perceived as a business-friendly city. As was mentioned, this issue will be examined in greater detail in the final chapter of this Assessment, but suffice to say, input participants emphasized that any Strategic Plan for Economic Development in Norman must examine improvements in the business climate – notably a reduction in costs and delays associated with permitting – as well as heightened support for existing business and entrepreneurs that would like to grow and expand in the community. Among survey respondents from the business community, 43 percent felt that the community has been unsuccessful at helping existing businesses overcome local barriers to growth and expansion while just 20 percent felt that the community has succeeded in this regard. Similarly, 33 percent felt the community had been unsuccessful at providing the necessary assistance to entrepreneurs and small businesses, as compared to 22 percent that felt the community had succeeded.

Input participants expressed concerns that real or perceived unfriendliness to businesses and developers could transcend the community’s entrepreneurial aspirations if Norman is seen as unwelcoming, excessively costly, or otherwise unsupportive of startup activity. Input participants and survey respondents also emphasized that the capital environment is lacking with no “homegrown” venture capital or angel networks to support the community’s startup potential. This is a challenge that many communities face as their most promising entrepreneurs are often forced to look outside their community and state for necessary funding.

Despite these reported challenges, self-employment is actually quite prevalent in Norman, an indicator of the community’s entrepreneurial spirit and potential. Despite recent reductions in self-employment over the last decade, more than one in ten individuals (11.4 percent) are self-employed, a rate that exceeds the average American community (7.6 percent) and that of communities such as Boulder (9.6 percent) that are often considered to be among the most entrepreneurially-minded and startup-friendly.

FIGURE 21: SELF-EMPLOYMENT, SHARE OF ALL PRIVATE SECTOR JOBS (2006-2016) Number of Self-Employed Self-Employed: % of Private Sector Jobs % Change Change 2006 2016 2006 2016 (’06-’16) (’06-’16) Norman, OK 5,761 5,222 -9.4% 14.9% 11.4% -3.5% Ann Arbor, MI 7,607 6,769 -11.0% 7.9% 7.2% -0.7% Boulder, CO 8,330 8,575 2.9% 10.3% 9.6% -0.7% Lawrence, KS 3,194 3,014 -5.6% 8.5% 7.9% -0.6% Oklahoma City MSA 46,241 42,919 -7.2% 9.3% 8.0% -1.3% United States 10,943,619 10,238,575 -6.4% 8.6% 7.6% -1.0%

Source: Economic Modeling Specialists International (EMSI)

A few relatively new resources in the community can help advance the community’s desired transition to a more entrepreneurially-minded and innovation-driven economy. Startup 405, the newly opened business incubator at OU’s Research Campus seeks to fill some of the gaps in the ecosystem. The goal of the incubator is to help provide the necessary support for startups and entrepreneurs in the form of office space, mentoring, networking, and other business assistance services. Ultimately, the facility is meant to help foster job growth in businesses with exportable products and services, especially. Its location at OU’s Research Campus is also intentional with hopes to better connect the start-up community with the university. It is proximate to the Innovation Hub, a resource for students that is home to the Fabrication Lab, the Center for

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

Entrepreneurship, and the Ronnie K. Irani Center for the Creation of Wealth, all of which help advance student ingenuity, entrepreneurship, and commercialization of technology.

Stakeholders frequently mentioned that Norman needs to do more to leverage the university and these resources, but more specifically, the research activities and specializations that have marketable applications and commercially-viable technologies within the private sector. More than just a training institution, major research universities are traditionally wheelhouses for innovation and are major sources of job creation in their communities. The most impactful research universities are surrounded by thriving ecosystems where institutional research is commercialized and spin-off activity is abundant. These powerhouses of economic activity stimulate local economies by creating jobs and attracting investment.

Stakeholders from a variety of sectors lamented that there doesn’t seem to be a particularly strong relationship between the business community in Norman and the academic research interests of the University. Of course there are exceptions and success stories, many of which are related to the institution’s established strength and reputation as the premier center for research and learning with respect to meteorology. But there is consensus among residents, business leaders, and community leaders that Norman’s economic future should include many more success stories in areas outside of meteorology.

FIGURE 22: ACADEMIC RESEARCH & DEVELOPMENT EXPENDITURES (2010-2015)

2010 2015 % Chg. 2015 Rank University of Oklahoma $218,089,000 $242,367,000 11.1% 88 University of Michigan, Ann Arbor $1,184,445,000 $1,369,278,000 15.6% 2 University of Colorado, Boulder $349,449,000 $420,775,000 20.4% 53 University of Kansas $267,961,000 $311,383,000 16.2% 75

Source: National Science Foundation, National Center for Science and Engineering Statistics, Higher Education R&D Survey

When examining academic research and development expenditures, it is evident that Oklahoma University both trails its competition and is failing to make progress in closing the gap. In 2015, OU’s research expenditures were considerably lower than that of the University of Colorado and the University of Kansas, despite all three institutions having roughly similar enrollment figures. The University of Michigan is considerably larger in both R&D output and enrollment. Other metrics of technology transfer and commercialization reflect similar gaps with peer institutions; OU trails its peers in licensing activity, licensing income, startup creation, and patent issuance.

FIGURE 23: UNIVERSITY COMMERCIALIZATION ACTIVITY (2015) Licenses and License Income Patents Startups Options Executed Received Issued University of Oklahoma 13 $1,594,055 3 10 University of Michigan 164 $78,779,947 19 159 University of Colorado 55 $6,311,884 13 56 University of Kansas 44 $9,832,208 1 38

Source: Association of University Technology Managers (AUTM)

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

4. PUBLIC EDUCATION: DEVELOPING & RETAINING TALENT IN NORMAN Although stakeholders may have lamented the relative lack of connections between the university’s research expertise and its private sector economic activity, there is no mistaking the community’s pride in the University as a provider of high-quality public education. And although many are quick to defend the community’s public schools and the quality of education that students are receiving, just as many are quick to inject skepticism regarding the relative quality of facilities and student outcomes as compared to other communities and districts in the region. Two observations are central to this story:

1. There are concerns among some residents that Norman Public Schools are an eroding strength, with this erosion jeopardizing talent retention efforts.

2. An institution of higher education is only an advantage for community in terms of talent production to the degree to which the community can retain its effectively graduates.

Before discussing Norman’s educational offerings, one issue must first be mentioned: state funding cuts to education. Online survey participants were asked what they would change at the state or local level to improve Norman’s competitive position with respect to economic development. The following word cloud displays the most common terms that were used in the open-ended responses. Many of the words used by survey respondents speak to this issue. Words such as “state,” “education,” “funding,” “tax,” and “teachers,” appear most frequently. This underscores the extent to which stakeholders view recent legislative actions as inhibitors to Norman’s economic growth and competitiveness. Economic developers in the state and site selectors that frequently represent companies evaluating the state have noted that perceptions of the state as a whole have taken a hit as a result of legislative actions, particularly as it relates to public education.

FIGURE 24: SURVEY QUESTION – “IF YOU COULD CHANGE ONE THING AT THE STATE OR LOCAL LEVEL TO IMPROVE NORMAN'S COMPETITIVE POSITION WITH RESPECT TO ECONOMIC DEVELOPMENT, WHAT WOULD IT BE?”

Source: Market Street Services; Norman Strategic Plan for Economic Development Survey (2017)

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

As mentioned previously, Oklahoma was hit hard by the recession and has suffered as a result of a downturn in the energy sector and decreasing sales tax. In response to these shortfalls in revenue, Oklahoma has made significant cuts to its education funding. Districts across the state have taken a variety of approaches to accommodate such deep cuts to their budgets. Some have had to increase class sizes or cut programs, while others have shifted to a four-day school week. Many districts have had to eliminate teaching positions or leave vacant position unfilled. Further compounding the issue is the fact that Oklahoma has one of the lowest average salaries for teachers and it has not raised teacher salaries in nearly a decade. This has reportedly made attracting and retaining teachers even more challenging. These issues and record cuts in education funding have brought national attention to the state of Oklahoma.

At the postsecondary level, state appropriations have also fallen. This has resulted in increases to the cost of tuition at the majority of the state’s higher education institutions. According to the Center on Budget and Policy Priorities, state spending per student in Oklahoma for higher education fell by 34 percent between 2008 and 2017.ii Only five states experienced large declines in state spending per student. Without a doubt, educational offerings influence location decisions of both people and businesses. Companies are attuned to the fact that their employees value quality educational choices for their families. Likewise, where a job is located and what the community offers is a significant factor for an individual that is weighing an employment opportunity. As such, the community and its offerings ultimately influence the type of talent that a company can successfully hire. In addition to talent attraction, a quality talent pipeline ensures companies that the community is able to develop homegrown talent to meet the workforce needs of employers.

Effective talent pipelines for workforce development and talent production begin far earlier than college and career development, with some beginning as early as prenatal education. There are many studies that detail the numerous benefits that early childhood education has on an individual, and evidence shows that access to quality pre-K is an important determinant of a child’s lifelong economic prosperity and personal well- being. Within early childhood education, Oklahoma has been a pioneer among states in providing free, quality pre-K for all children in its school districts. Despite significant cuts in education funding in recent years, Oklahoma has continued to be a top state for preschool participation. According to the National Institute for Early Education Research (NIEER), 74 percent of 4-year olds in Oklahoma were enrolled in pre-K in 2016, and the state ranked third in access. Norman Public Schools (NPS) offers its pre-K program at all elementary sites within the district for children 4-years old. Though more could be done to provide access to pre-K for 3-year olds, Oklahoma remains a leader in early education for providing state-funded pre-K programs for its 4-year olds.

At the K-12 level, survey participants were asked a series of questions about the school districts with which they were most familiar. Roughly 92 percent of these responses were from students and parents of current or previous students at NPS, and the results that follow are restricted to those evaluating NPS. Overall, NPS received favorable ratings across a broad range of aspects related to its K-12 offerings. In fact, the majority of survey participants agreed or strongly agreed with all but one of the statements related to the quality of offerings and/or student outcomes within NPS. An impressive 79.6 percent of these respondents felt that children in the district receive a high-quality education. Survey respondents also overwhelmingly agreed that students have sufficient access and exposure to technology in the classrooms and that there are ample learning opportunities for advanced students.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

FIGURE 25: SURVEY QUESTION: “PLEASE RESPOND TO THE FOLLOWING STATEMENTS ABOUT THE SCHOOL DISTRICT* WITH WHICH YOU ARE MOST FAMILIAR.” *REPORTED RESPONSES LIMITED TO 705 STUDENTS AND PARENTS OF STUDENTS ATTENDING NORMAN PUBLIC SCHOOLS IN THE LAST FIVE YEARS

Students have sufficient access and exposure to technology in the classroom. 9% 88% Children in this district receive a high-quality education. 14% 80% There are ample learning opportunities for advanced students. 8% 15% 77% Administrators and elected officials are committed to quality, public K-12… 10% 18% 72% The quality of our public schools support our community's growth. 10% 19% 70% Schools in this district provide a safe learning environment. 9% 24% 67% The business community is committed to supporting quality, public K-12… 9% 26% 65% STEM (science, technology, engineering, mathematics) education receives… 13% 20% 68% Facilities are modern, well-kept, and sufficiently spacious. 15% 19% 66% There are good resources for disadvantaged or disabled students. 14% 23% 63% Career education receives adequate attention. 21% 26% 53% Students receive high quality career guidance and college counseling… 30% 30% 40%

0% 20% 40% 60% 80% 100% Strongly disagree or disagree Neutral Strongly agree or agree Source: Market Street Services; Norman Strategic Plan for Economic Development Survey (2017) Questions was presented to 705 survey respondents that self-identified themselves as having attended or having a child that attended NPS at any point in the past five years.

Stakeholders from around the community reported that the K-12 school district used to be one of the main reasons that families moved to Norman and is still an attractive quality of young families. Of the survey respondents, 70.4 percent agreed with the statement that the quality of our public schools support our community’s growth. However, stakeholders also expressed concern that Norman is not attracting as many families seeking its school district as it has in recent decades. Input participants reported that Norman is increasingly facing competition from other metro cities whose facilities and student outcomes have improved.

FIGURE 26: K-12 PERFORMANCE INDICATORS, STUDENT OUTCOMES, TEN LARGEST METRO DISTRICTS Graduation Rate Dropout Rate Average ACT Score District (2015 cohort) (’14-’15) (’15-’16) Deer Creek >= 95% 0.2% 23.6 Edmond 93% 0.9% 23.6 Midwest City-Del City 92% 0.5% 19.3 Choctaw-Nicoma Park 91% 0.8% 20.9 Yukon 91% 1.1% 21.9 Mustang 89% 1.9% 21.4 Moore 82% 1.6% 21.6 Putnam City 82% 2.0% 18.1 Norman 78% 1.3% 23.0 Oklahoma City 74% 2.8% 17.4 Source: Oklahoma Department of Education

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

In general, these sentiments are supported by the district’s performance metrics. Across a variety of indicators, NPS outperformed the state average. At the two high schools in the district, Norman North High School and Norman High School, 82 percent and 77 percent, respectively, of students passed the state’s assessment exams, aggregated across subjects. In comparison, 67 percent of students statewide passed. However, when compared to other large school districts in the metro area, NPS trails in some key metrics. Out of the ten largest district in the region, the graduation rate trailed all but the Oklahoma City School District. In 2015, 78 percent of NPS students graduated in four years. In comparison, 93 percent of students at Edmond Public Schools and 82 percent of students at Moore Public Schools graduated in four years. It has been suggested that some reporting errors in Norman public Schools resulted in abnormally low graduation rates in 2015. It is anticipated that reported graduation rates for more recent years will reflect better student outcomes.

Edmond and Moore were often cited by stakeholders at cities that Norman competes with in the metro area for both residents and jobs. Stakeholders reported that school facilities in these communities have better “curb appeal” which influences residential location decisions. Data show that school districts throughout the metro have indeed grown and improved their performance outcomes. Many of these districts are in nearby communities that Norman may be competing with for jobs and residents, especially families with young children enrolled in public school. Norman is now the fifth largest school district in the metro area. Over the past five years, enrollment increased by 6.1 percent at NPS, while the districts in Edmond and Moore grew by 11.0 and 7.4 percent, respectively. It is evident from the data covering students eligible for free and reduced price lunches that the relative composition of student bodies is changing: Norman Public Schools are increasingly accommodating children with financial needs whereas Moore and Edmond are increasingly attracting students from higher income households. While some may lament these changing socioeconomic composition of the student body, a community whose schools are able to produce comparable (or in some cases, better) average student outcomes for a student body with lower average socioeconomic status – and accordingly, a variety of measured disadvantages – should be proud of this fact.

FIGURE 27: CHANGE IN K-12 ENROLLMENT, TEN LARGEST METRO DISTRICTS

TOTAL ENROLLMENT FREE/REDUCED LUNCH % Free/Reduced Percentage Point Enrollment Percent Change Lunch Change District (2017) (2012-2017) (2017) (2012-2017) Oklahoma City 38,989 0.8% 84.4% -4.0% Edmond 24,403 11.0% 26.7% -1.7% Moore 24,355 7.4% 45.3% -1.7% Putnam City 19,476 1.8% 78.6% 6.2% Norman 15,942 6.1% 48.8% 1.6% Midwest City-Del City 14,303 -1.5% 69.8% 6.9% Mustang 11,031 20.2% 37.6% 3.2% Yukon 8,479 10.1% 44.0% 6.9% Deer Creek 5,903 39.3% 10.2% 3.6% Choctaw-Nicoma Park 5,772 10.1% 44.3% 6.1% Source: Oklahoma Department of Education

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

Although NPS received high ratings in nearly every category, input participants rated its college and career preparation less favorably. Among the K-12 statements that survey participants were asked to rate, roughly 30 percent of respondents strongly disagreed or disagreed with the statement, “students receive high quality career education and college counseling services.” This statement received the least favorable rating among the 12 statements that survey participants were asked to rate. Following this, “career education receives adequate attention” received the second lowest rating. Many survey participants reported that there was an insufficient supply of career counselors, and that the few that are in the schools are overloaded and cannot possibly serve all the students with career guidance. Additionally, stakeholders expressed concern over “students falling through the cracks” and outreach to students that are not college bound.

FIGURE 28: HIGHER EDUCATION ENROLLMENT & COMPLETIONS PER 1,000 RESIDENTS (2015-2016) Total Total Total Associate's Bachelor's Master's Doctorate

Enrollment Certificates Degrees degrees degrees degrees degrees Norman, OK 74.3 2.0 11.2 3.2 5.0 2.2 0.8 Ann Arbor, MI 76.7 1.6 12.8 2.2 6.5 3.3 0.8 Boulder, CO 95.3 2.7 12.7 1.9 7.1 2.8 0.8 Lawrence, KS 53.3 0.3 11.4 0.2 6.9 2.9 1.4

Source: National Center for Education Statistics, IPEDS; Economic Modeling Specialists (EMSI) Note: The figures were derived by using population estimates and education institutions within a 25 miles radius from each of the cities. Enrollment figures are for the 12-month unduplicated headcount total.

To measure the higher education capacity in Norman against its benchmark cities, enrollment figures and certificate and degree output of the higher education institutions within 25 miles of each of the cities was aggregated and is displayed per 1,000 residents in the accompanying. The data shows that degree output in Norman was roughly equivalent to that of Ann Arbor, Boulder, and Lawrence. An analysis of the degree output by award level indicates that the capacity in Norman at the four-year and higher level is slightly less than that of its peers. However, Norman has a high capacity of associate degree output compared to the other cities. Certificate competitions per capita trailed Boulder but exceeded both Ann Arbor and Lawrence.

Moore Norman Technology Center (MNTC) was spoken highly of by stakeholders from around the community. Catering to both adults and high school students, the education center is a valuable asset to the community that can be leveraged to improve the skills of residents and the city’s overall workforce. MNTC has program advisory committees in place with business and industry leaders. The programming is therefore designed to meet industry standards in order to train or retrain individuals into relevant, up to date, and in- demand careers. According to the 2015 Progress Report to Taxpayers, 90.9 percent of MNTC graduates were employed or continued their education upon graduation. In addition to training the area’s residents, MNTC is a valuable asset that can be marketed to existing and potential companies. With that said, those familiar with MNTC reported that there are capacity limitations and that there are waiting lists for many programs. Demand in health care fields and cybersecurity is reported to be strong, while there is interest in potentially developing curriculum in the fields of aviation and robotics.

Without question, Norman is fortunate to be home to the University of Oklahoma, a major asset with tremendous training capacity. The university offers many opportunities to the city, including the means to improve the community’s educational attainment rates. In addition to the fact that major research universities typically attract highly educated administrative and faculty to work at the institutions, OU produces a fresh supply of thousands of new graduates every year. These new graduates have the potential to support the

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma local economy’s workforce demands and improve the skill base of residents. However, its role in improving the educational attainment and workforce capacity of Norman hinges on the community’s ability to successfully retain OU students upon graduation.

FIGURE 29: SURVEY QUESTION: “IN YOUR OPINION, WHAT IS NORMAN'S GREATEST STRENGTH OR ASSET AS A PLACE TO LIVE, WORK, VISIT, AND DO BUSINESS?”

Source: Market Street Services; Norman Strategic Plan for Economic Development Survey (2017)

A 2016 survey of 300 OU students as part of the “Brand Dig” study found that only three percent of students surveyed indicated they would definitely stay in Norman after graduating, while 46 percent indicated that they definitely would not live in Norman after graduation and 48 percent indicated that they would consider living in Norman but would also consider living elsewhere. Of the 46 percent that indicate that they would definitely not live in Norman after graduation, the most commonly cited reasons were not enough job opportunities, a desire to live in a bigger city, and a job lined up elsewhere.

They survey findings of OU students are similar to what was heard through the input for this process. Many stakeholders expressed concerns over the retention of graduates and reported that it was “harder than it should be to get talent from OU.” Input participants reported that the lack of diversity of jobs in the community resulted in graduates being unable to find employment opportunities locally and remain in Norman after graduation. In fact, of the OU students surveyed in the “Brand Dig” study that reported that they did not want to live in Norman after graduation, 66 percent said a good or better job opportunity locally would help convince them to stay in Norman after school.

Other stakeholders reported that the city’s inability to retain graduates was also due, in part, to the weak relationship between the business and academic community in Norman. Others reported that for some, there is a perception among young professionals that graduate from OU where they feel like they are ”settling” if they stay in Norman. At the same time, many input participants reported that the city’s quality of life did not appeal to young professionals which caused challenges in attraction and retention of talent. Students and young professionals asserted that the community needed to evolve from a “traditional university town” to one that had more to offer to young professionals in the form of both careers and quality of life. Many were quick to emphasize the role of downtown, entertainment districts, and pockets of activity off campus.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

5. QUALITY OF LIFE IN A UNIVERSITY TOWN In recent years, the relationship between quality of life offerings and economic development competitiveness has strengthened. Companies rate access to a skilled and talented workforce as a top site selection component that is driving location decisions. At the same time, young workers are increasingly prioritizing where they want to live before an employment opportunity. Consequently, quality of life and place offerings play a significant role in a community’s economic opportunities. A community’s built environment and amenities are therefore about more than just creating a nice place to live for residents; they are intrinsically linked to the community’s economic development and prosperity.

The role that quality of place and quality of life play in community and economic development is possibly best supported by the insightful research conducted by the John S. and James L. Knight Foundation and Gallup. The report, “Knight Soul of the Community 2010,” was a three-year study that sought to determine what factors attach residents to their communities and to what degree community attachment impacts economic growth and well-being. The report defines community attachment as, “an emotional connection to a place that transcends satisfaction, loyalty, and even passion. A community’s most attached residents have strong pride in it, a positive outlook on the community’s future, and a sense that it is the perfect place for them. They are less likely to want to leave than residents without this emotional connection. They feel a bond to their community that is stronger than just being happy about where they live.”

According to the report, there are three factors that primarily drive community attachment:

 Social offerings (such as entertainment infrastructure, community events, places to meet people)  Aesthetics (physical beauty, green spaces, etc.)  Openness (how welcoming a place is to different types of people)

The report found that if people are attached to their community then they are more likely to engage in it and help make it a better place. Beyond that, residents that are more attached to their community are also more likely to shop and dine locally, ultimately benefiting the local economy. Further, employees that are activity engaged and attached to their community often lead to increased productivity, profitability, and higher rates of employee retention. In other words, the report found a positive relationship between communities with higher levels of community attachment and those that were economically successful, underscoring the importance that emotional attachment plays in the well-being of a community.

There are many factors that influence the attractiveness of a community’s quality of life and place offerings. These factors can be extremely subjective and their desirability can vary depending on the constituency. College students, young professionals, families with young children, and retirees all place varying degrees of importance on certain factors. For example, families with young children are likely to place a greater degree of importance on a community’s public schools when choosing where the live, while young professionals are increasingly choosing more urban lifestyles that afford them the life-work-place lifestyle. At the same time, retirees are seeking cities where they can age in-place and remain active in a community. While the degree to which these quality of life offerings may vary among these groups, there are many commonalities that exist among them. Survey participants were asked to rate a variety of quality of life and place aspects related to Norman’s quality of life, the results of which can be seen in the accompanying figure.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

FIGURE 30: SURVEY QUESTION: “PLEASE RATE THE FOLLOWING ASPECTS OF NORMAN'S QUALITY OF LIFE, BASED ON YOUR EXPERIENCES WHERE YOU LIVE.” Volunteer opportunities 41% 53% Cultural and arts facilities and programs 11% 32% 57% Dining opportunities 11% 38% 52% Sense of personal and property safety 9% 40% 51% Overall cost of living 10% 40% 50% Aesthetics and appearance of the community 12% 42% 47% Diversity of housing options (single-family, multi-family,… 12% 46% 42% Entertainment and recreational amenities for families 18% 39% 43% Shopping opportunities 16% 45% 39% Affordability of housing options 23% 41% 37% Nightlife options for adults 30% 42% 27% Quality of development, planning, and land use 31% 44% 26% Availability of recreational paths and trails 36% 36% 28% Quality and connectivity of sidewalks 44% 37% 19% Quality and connectivity of public transportation 55% 33% 13% Ability to access shops, restaurants, and services without a car 61% 25% 14%

0% 20% 40% 60% 80% 100% Very poor or below average Average Excellent or above average

Source: Market Street Services; Norman Strategic Plan for Economic Development Survey (2017)

The remainder of this section details some of the specific factors affecting the quality of life and place and summarizes certain key themes that were heard throughout the input sessions and through the online survey, beginning with factors that drive community attachment.

SOCIAL OFFERINGS: Overall opinions varied regarding the quality of the entertainment options, community events, and places to meet people that currently exist in Norman. Many input participants commented that Norman was a good place to raise a family and that OU’s Campus Corner was a fun gathering place for college students. Over half of survey respondents felt that the city’s dining opportunities were excellent or above average, and 43.3 percent felt that Norman had excellent or above average entertainment and recreational amenities for families.

Stakeholders also spoke highly of the city’s cultural and arts facilities and programs and reported that Norman is home to a robust and thriving arts community. It received the highest rating among the various quality of life factors with 57.1 percent of respondents rating it as above average or excellent. Input participants reported that the arts and cultural community was also one of the few areas where the city and university really worked together. The museums and cultural offerings both on and off campus are assets to the community. Overall, Norman’s arts and non-profits support over 1,500 full-time jobs and bring in over $4.8 million in local and state tax revenue. In total, the economic impact of the city’s arts non-profits topped $56 million in 2015.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

Additionally, input participants spoke favorably of the many community events and festivals. Yet, despite Norman unofficially being dubbed the “city of festivals,” individuals commented that the city was missing the necessary infrastructure to support festivals. It was also reported that Norman lacked decently-sized concert venues and that the university’s facilities aren’t available to the public, making it difficult for the community to bring in larger attractions.

At the same time, input participants reported that although Norman has numerous amenities and community offerings related to quality of life, more was still needed to make the city an attractive place to live for all residents. As one survey participant put it, “While I think Norman has improved its entertainment opportunities in recent years, I feel like most still center around the university. Don’t get me wrong — I love Jazz in June, the Music Fest, and the Art Walks, I don’t think that there is much of a culture for an ‘everyday’ nightlife once you leave the University or Main Street.”

Many stakeholders commented that beyond families and college students, the social offerings in Norman were below average and that many of neighboring cities, including Oklahoma City, offered far better entertainment options for young professionals, especially. One survey participant commented, “I find myself constantly going to Oklahoma City to have a night out - to go to a fancier restaurant, to find a bar that isn't inundated with college students, or to find a place to dance where I, at 28, don't feel completely out of place because everyone else is 20-22.” Feedback from the survey of OU students in the Brand Dig study reported that, “The city is viewed as a homey, quaint and exciting college town with a fun atmosphere and good people. However, while these brand attributes are important to students, they do not necessarily translate well to the next stage of their life: their metamorphosis into Young Professionals.”

Likewise, stakeholders suggested that the community must continue to prepare for a population that is rapidly aging. This includes an emphasis on walkability and amenities for seniors. Some expressed that the community lacked a modern senior center, while others expressed skepticism about the likelihood that a planned new senior center approved by voters in a recent referendum would receive the necessary funding.

AESTHETICS: Roughly 47 percent of survey participants felt that Norman’s aesthetics and appearance was excellent or above average. Open-ended responses revealed that many felt that Norman has many beautiful areas, particularly the University’s campus, but that there was a wide disparity throughout the community and the beauty on campus doesn’t extend throughout the city. Many spoke of this issue in the context of “first impressions” and resident pride.

OPENNESS: In general, Norman’s openness and acceptance of individuals from all backgrounds was mentioned as positive community attributes. As the United States continues to diversify, openness and acceptance are important characteristics of a community if it wants remain competitive for talent and jobs. Norman’s comprehensive plan update, PlanNorman, also asked survey participants about a variety of community factors. When asked to evaluate certain community values, a safe and inviting community was rated as the most important value among individuals that participated in public workshops.

Norman’s race and ethnic distribution shows that the city has a high share of its population that is white, not-Hispanic. However, similar to communities across the county, its diversity is growing. Between 2011 and 2016, the share of the population that is Hispanic increased by 1.4 percentage points, while the share that is white, non-Hispanic fell by 4.4 percentage points. In the Oklahoma City metro area, the share of the

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma population that is Hispanic increased by 1.3 percentage points, while white, non-Hispanics fell by 2.3 percentage points.

Survey respondents were asked to rate the degree to which they agreed or disagreed with the statement, “Norman is a welcoming and inclusive community to people of all backgrounds.” Approximately 63 percent of survey participants strongly agreed or agreed with the statement, while 22.3 percent were neutral. Only 14.3 percent strongly disagreed or disagreed with the statement. Input participant frequently stated that Norman’s diversity was a competitive advantage relative to other communities in Oklahoma. This distinction included the fact the university attracts individuals from all over the world to Norman. Additionally, the university’s more liberal base was viewed as balancing the more conservative base in Oklahoma. But many new residents reported that the community was not as diverse or inclusive as they would like. And others have emphasized that Norman competes with communities across the country and the world, and not simply those in Oklahoma with which Norman may view itself favorably with respect to openness, inclusion, and tolerance. According to representatives from the University, students from large, more diverse regions of the country can find Norman to be less diverse and potentially less tolerant of diverse backgrounds and viewpoints than their hometown. It was also reported that some non-white students find Norman to be “isolating.”

An incident in 2015 at the University in which two students were seen on video singing a racist song brought the issue of diversity and tolerance to the forefront of community conversation in Norman just three years ago. The University responded quickly with condemnation, hiring of a Chief Diversity Officer, and the development of a five-hour diversity training course for incoming freshman and transfers, among other actions. These are important steps for any community, particularly one that seeks to enhance retention of college graduates and support more diverse, innovative economic development. Immigrant entrepreneurs start more than a quarter of all new businesses in the United States despite representing just 13 percent of the population; they are nearly twice as likely to start a business as their native-born counterparts. Communities that welcoming and inclusive of diverse populations, including but certainly not limited to immigrants, will be better positioned to support economic growth through entrepreneurship.

HEALTH CARE: Few public input participants referenced the community’s health care system or public health outcomes when discussing community strengths and weaknesses but of those who did, most suggested that the community’s health system – Norman Regional Health System – afforded residents with high quality options for care. Health care services are a key but often overlooked component of a community’s quality of life offerings, a component that will become increasingly important to communities that wish to be attractive destinations for retirement and/or aging in place. But according to data covering the number of physicians employed per capita, Cleveland County ranks 9th out of ten communities examined in the Competitive Scorecards that accompany this Assessment. With respect to health outcomes, the data suggest that Cleveland County is in a similarly poor position: it ranks 9th in the percentage of adults with a BMI greater than or equal to 30, and 8th in the percentage of adults reporting poor or fair health.

RECREATION: Many lamented the lack of a coastline or mountains, and cited the region’s terrain and lack of such features as challenges in talent recruitment. A cleaner Lake Thunderbird was cited as having tremendous potential to improve Norman’s quality of place by providing a compelling natural amenity. However, input participants stated that Lake Thunderbird’s trails are currently overgrown and that the area is dirty, and therefore, underutilized. Overall, 36.1 percent of survey respondents felt that the availability of

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma recreational paths and trails were very poor or below average. During this input process and during the city’s Comprehensive Plan Update, residents have repeatedly expressed a desire for more quality parks and trails.

CONNECTIVITY, WALKABILITY, AND TRANSPORTATION: Among the various quality of life factors that survey respondents were asked to rate, connectivity and walkability received the least favorable ratings. Roughly 61 percent of survey participants felt that the ability to access shops, restaurants, and services without using a car was below average or very poor. Likewise, 55 percent of respondents felt similarly about the quality and connectivity of public transportation, while 43.6 percent reported that the quality and connectivity of sidewalks were below average or poor. Combined, these three aspects of Norman’s quality of life have important implications on its competitive future.

Both nationally and in Norman, there is a strong desire for walkable areas that offer the “live, work, play” lifestyle. Campus Corner was mentioned as perhaps the one area of town that residents could potentially walk to restaurants and shops. However, even it lacks the ability to walk to places such as a grocery store. But as one survey participant noted, “there's nowhere that you can really just park your car and walk around for shopping, dining or entertainment. You can't even do this on Campus Corner because the parking meters are for a limited amount of time and you can't feed the meter again. You must move your car. If I'm going to move my car, I'm probably going to just leave.”

One available indicator, Walk Score, measures walkability on a scale from 0 - 100 based on walking routes to destinations such as grocery stores, schools, parks, restaurants, and retail, with 100 indicating that a city is very walkable. Norman has a Walk Score of 30, trailing the walkability ratings of its peers (Ann Arbor, 51; Boulder, 58; Lawrence, 40).

Likewise, 36.1 percent of survey respondents felt that the availability of recreational paths and trails was very poor or below average in Norman. Many stakeholders reported that while there were some bike paths available, biking around Norman was dangerous. Markings and signage to share the road are reportedly inconsistent and ineffective and many streets do not have designated bike lanes. Roads that do have bicycle lanes are reportedly narrow and not safe for bicyclists. Stakeholders, especially young professionals, frequently expressed the desire for better, safer walking and biking trails and more outdoor recreational opportunities. Overall, improving bike lanes and adding more routes, especially on the east side of town, was frequently cited as desired quality of life improvements for Norman.

Input participants also frequently cited the community’s lack of public transportation as a key challenge for residents and a potential inhibitor to future talent attraction and economic development. It was one of the most frequently mentioned challenges facing the community. Over half of survey respondents (54.5 percent) felt that the quality and connectivity of the city’s public transportation was below average or poor. Norman is served by the Cleveland Area Rapid Transit (CART). The buses run several route around the City and OU campus during the weekdays and most Saturdays. Although CART provides good routes for college students, the remaining residents in Norman are not as well served. Both service and connectivity is reportedly lacking and stakeholders noted it simply is not an option for many to traverse Norman.

This all adds up to the fact that Norman is a very car-dependent city. In total, 81.7 percent of workers that live in Norman commute to work by driving alone. This rate was similar to that of workers in Lawrence and the Oklahoma City metro. However, it stands in stark contrast to the commuting characteristics of workers in Ann Arbor and Boulder. In Boulder, nearly a quarter of workers walked, biked, or used another mean of

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma transportation to work. Traffic in Norman was frequently cited as a growing challenge. The roadways to transverse east to west through Norman are reportedly inadequate and commuting to Oklahoma City from Norman is becoming increasingly difficult. On average, it takes Norman workers 21.1 minutes to commute, slightly higher than all comparisons but more than five minutes below the national average (26.6 minutes).

FIGURE 31: MEANS OF TRANSPORTATION TO WORK (2016) 100% 7.9% 5.0% 6.8% 14.9% 6.6% 4.5% 90% 5.1% 8.2% 9.2% 18.9% 7.4% 80% 9.0% 22.6% 70% 10.1%

60% 7.4% 7.3% 4.8% 50%

81.7% 83.2% 40% 80.3% 76.3% 30% 55.7% 50.3% 20%

10%

0% Norman, OK Ann Arbor, MI Boulder, CO Lawrence, KS OKC MSA United States Drove alone Carpooled Public transportation Walked, biked, or other means Worked at home

Source: United States Census Bureau, ACS 1-year estimates

It must be emphasized that a number of projects and investments are planned or underway with respects to quality of life offerings. In 2015, the City passed a one half of one percent sales tax increase to provide funding for quality of life projects. The NORMAN FORWARD project was initiated by citizens in an effort to improve the City’s quality of life offerings such as recreational facilities, libraries, parks, athletic, venues, trail, and other quality of life projects. The measure based with 72 percent of Norman votes, illustrating the strong support that residents have for improving the City’s social offerings. Since that time, progress has been made on several projects including the Central and East Branch Libraries, the Westwood Family Aquatic Center and Tennis Center, and park renovation projects. The community’s support for Norman Forward is a positive sign that residents want to invest in their city and see it grow into a more thriving and successful community.

The Center City visioning process has also helped establish a vision for development in an area connecting Campus Corner and downtown. The emergence of a more walkable, mixed-use district connecting these two activity centers could greatly enhance the community’s quality of place. Similarly, efforts are underway to evaluate the viability and financing of a new entertainment district at University North Park (UNP) that is adjacent to the Interstate and potentially home to a new arena for University of Oklahoma basketball and other functions. Such a development, inclusive of greater residential density, would improve the long-term viability and competitiveness of adjacent retail at UNP while improving the marketability of certain sites available for office development in and around the area. This potential development at UNP has reignited what many described as a persistent “growth – no growth” debate in Norman.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

6. GROWTH, DEVELOPMENT, AND COMMUNITY VISION Throughout input, the topic of growth and development was discussed more frequently than any other. Input participants reported that the issue is a divisive topic with passionate residents on both sides of an ongoing “growth – no growth” debate.

On the one hand, through an aversion to certain development, some residents wish to preserve the community’s character, green space, and overall size. They hope that the community will be able to mitigate traffic congestion, overcrowding of schools, and other outcomes that they worry could emerge as byproducts of continued growth. And through interviews and focus groups, it was evident that such opinions are sufficiently present and visible in the community for some input participants to categorize a segment of the community’s residents as “no growthers.”

Some suggested that this was simply a “vocal minority” and the true majority opinion is not adequately represented at public meetings. But in reviewing the comments of more than 1,600 residents responding to the online survey, it is evident that resident opinions with respect to growth and development are far more nuanced than simply “growth – no growth.” Individual residents rarely speak in absolutes; rather, they describe the types of developments and built environment that they would embrace. Nearly all wish to see a community that is more accessible and walkable for young professionals and seniors alike. They acknowledge that redevelopment is necessary to help achieve these objectives. While some may express a desire to see fewer apartments built, they understand the value of providing housing is that affordable to young graduates that the community wishes to retain.

There are countless other examples of this nuance but the conclusion is the same: by and large, resident opinions reveal that the debate should not focus on the question: “Should we grow or not?” but rather, “How should we grow, where should we grow, and who should pay for it?” However, it should be noted that no community is ever unanimous in terms of how residents would like to see their city grow, who should pay for it, and where and what type of growth should occur. These debates are pervasive across the United States, but clearly more prominent in the minds of stakeholders in Norman. Make no mistake, reasoned debate among residents and stakeholders surrounding these issues are an unquestionable positive for Norman. It is a sign that residents are attached to their community, passionate about its direction, and defensive of their vision for it. This level of engagement is an asset; communities with disengaged and apathetic populations are rarely attractive to others.

That being said, the challenge for Norman is to ensure that the lack of unanimity in resident opinion does not impede the process of deriving consensus and advancing reasonable policy. Many stakeholders and residents observed that the aforementioned mentality inhibits progress and has resulted in a perception that Norman is not a development-friendly community. This perception hinges on both mentality and policy.

With regards to policy, developers and business owners cited the community’s reputation as “not business friendly” and noted that this reputation, and the policy that supports it, is the single greatest inhibitor to Norman’s growth and development. This feedback is primarily focused on challenges with permitting and it transcends multiple factors from costs, to time, to relationships. The cost of permit acquisition and the ease and speed of the permit review process were the lowest rates features of the community’s business climate by survey respondents. Stakeholders in the business community seem to be keenly aware of the relative costs of development between Norman and surrounding communities.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

FIGURE 32: COMBINED WATER & SEWER CONNECTION CHARGES (APRIL 2016)

Single-Family Multi-Family Commercial Norman, OK $2,975 $16,345 $13,712 Broken Arrow, OK $745 $860 $860 Denton, TX $11,595 $18,025 $47,400 Edmond, OK $2,700 $14,052 $28,445 Lawrence, KS $4,235 $20,010 $50,325 Lawton, OK $2,000 $8,000 $8,000 Midwest City, OK $992 $4,344 $2,367 Moore, OK $1,300 $3,632 $1,300 Oklahoma City, OK $1,625 $2,935 $6,020 Stillwater, OK $977 $8,080 $10,688 Source: City of Norman Planning & Development, Water and Wastewater Connection Charge Study Report; Raftelis Financial Consultants, Inc. The data collected makes the following assumptions for comparison purposes: single-family home assumed to be 1,500 square feet with two toilets and 0.75 tap size; multi-family development assumed to have 4 units, 2 toilets per unit, 6,000 total square feet, tap size of 1, and sewer diameter of 4; commercial development assumed to have 30 employees over 10,000 square feet with 5 bathrooms, tap size of 2, and sewer diameter of 6. The Survey was conducted in April 2016.

A connection charge survey conducted by Raftelis Financial Consultants, Inc. (RFC) on behalf of the City of Norman for its 2016 Water and Wastewater Connection Charge Study reveals that, beyond permitting time and costs, the anecdotal evidence is supported by data. The survey results show that costs associated with building in Norman are, in fact, higher than many of the surrounding areas and other benchmark cities, in some cases significantly so. Based on the city’s existing water and sewer costs, Norman’s costs are more than double that of Moore and are 10 percent higher than those in Edmond. Even the city’s core, Oklahoma City, has fees that are on average $1,350 less than what they are in Norman. Furthermore, stakeholders have suggested that differentials in impact fees across jurisdictions may actually be larger when examined for larger homes that more closely approximate the average square footage of new housing stock in the community (as opposed to the 1,500 square foot assumption applied in the aforementioned analysis).

It must be noted that choices about the community’s development patterns, supported by policy in the form of zoning code and other factors, greatly influence the costs associated with infrastructure provision to new development. Generally speaking, communities that are characterized by sprawling, low-density, large lot developments will have higher infrastructure extension and maintenance costs than those with higher- density centers of activity. In addition, cost structures also reflect choices regarding the manner in which infrastructure costs are recovered via user chargers and connection fees. All else constant, a community that elects to recover the majority of its costs through user charges should have lower connection fees, and vice versa.

In recent years, the City of Norman has taken a number of steps to help improve relationships with the business and development community. This includes but is not limited to revisions to the City Subdivision Development Regulations to streamline zoning and platting processes; hiring an additional examiner to support commercial permit review; monthly surveying on non-residential permit applicants regarding satisfaction with inspection and permitting services, and; the implementation of “brown bag’ meetings between City staff, developers, and members of the Builders Association of South Central Oklahoma (BASCO) to discuss process and any concerns. Despite these efforts, a number of business leaders and developers

January 2017 Page 37

Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma cited recent declines in the number of single-family building permits issued in Norman as a sign of the community’s true or perceived unfriendliness to developers. The implication was clear: developers are choosing to build housing in other parts of the region that are easier and/or less costly in which to build. An analysis of single-family permit issuance over time reveals that on a per capita basis, Norman has historically developed single-family housing at a rate that is comparable to other parts of Cleveland County and the metro area. In fact, Norman has, on average, consistently been permitting single-family development at a higher rate per capita than the rest of the Oklahoma City metro area from 2000 until 2012. The entire region experienced a decline the rate of development during a period that coincided with the bursting of the national housing bubble and the subsequent Great Recession. Communities and the region as a whole recovered from 2010 – 2012, but in 2012, the permitting trends began to change once again. Permit issuance rose in 2013 and 2014 in the City of Norman as the community’s housing market continued to recover, however, the rate of single-family development in the rest of the metro accelerated much faster. From 2000- 2012, the City of Norman permitted 9.8 percent of the metro area’s single-family housing stock, ranging from eight to eleven percent on an annual basis. In 2012 this share dropped to 7.6 percent and further, to 6.7 percent in 2013, despite growth in total permit issuance in the City. Total single-family permit issuance began to decline in 2014, and this is the trend that is most frequently cited by the development community: from 2014-2016, the number of single-family building permits issued in Norman fell from 539 to 363 (-33 percent). On the surface, this trend may seem alarming. But it lacks some necessary context.

FIGURE 33: SINGLE-FAMILY BUILDING PERMITS ISSUED PER 1,000 RESIDENTS (2006-2016)

12.0

10.0

8.0

6.0

4.0

2.0

0.0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016

Norman Edmond Moore Oklahoma City OKCMSA

Source: U.S. Census Bureau; Building Permits Survey

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

Over the same two-year period (2014-2016), single-family permit issuance declined by 54 percent in Moore and 30 percent in Edmond. It has been suggested that much of the decline in permitting in Moore can be attributed to a spike in permitting in 2013 that followed the tornado that struck Moore that same year. It is evident that there was indeed a spike in permitting in Moore, but more recent trends mimic those observed in Norman and elsewhere: single-family permitting declined by 18.2 percent from 2015-2016 in Moore as compared to 23.9 percent in Norman and 25.7 percent in Edmond.

Meanwhile, single-family permit issuance declined by just 12.3 percent in Oklahoma City. The trends illustrate that Norman is not alone among its suburban peers in the metro area. While the anecdotal evidence that negative perceptions have hurt the city cannot be wholly discounted, it is difficult to reach the conclusion that relative differences in permitting costs or time can explain recent declines in single-family permitting. What is far more likely is that the trends observed in Norman, Moore, and Edmond relative to Oklahoma City reflect the changing residential location preferences referenced throughout this report. Developers take notice of such trends and respond accordingly. Recall that Norman and other suburban areas across the country experienced a net outmigration from their communities to the urban cores of their metropolitan regions, in many cases for the first time in decades, beginning in 2013. This trend was evident in IRS migration data from 2013 to 2014, and it is certainly reasonable to assume that residential developers took note of these trends, reflected in the form of lower demand for single-family housing and longer time on the market for existing home sales, and adjusted their building activity accordingly. Such a response to market conditions is typical.

And so, while concerns about the development environment are unquestionably justified – costs are objectively higher – it is difficult to connect recent declines in permitting activity to this development environment. Rather, the changes in permitting activity are more likely a reflection of changing residential location preferences. The concern for developers is that heightened development costs have and will continue to elevate housing prices in Norman to a level that pushes families to nearby communities, families who might otherwise choose to live in Norman. And if these concerns about cost coincide with heightened interest in places and built environments that Norman is unable to provide, the consequences could be significant for Norman with respect to its workforce and economic development objectives.

Throughout input, stakeholders frequently commented that they can “get more house for less” in neighboring communities, and that “people aren’t willing to pay more to live here anymore.” Additionally, community and business leaders reported that “executive housing” is more expensive in Norman than nearby communities, which has resulted in many prospective residents choosing to live outside of Norman.

Higher housing costs – both perceived and actual – extend to the rental market as well. Input participants reported that the lack of quality, affordable rental options make it more difficult to retain recent college graduates. Although there are affordable apartment options, many are aimed at college students, leaving young professionals and families without too many options, especially for those looking to rent a single- family house. Additionally, in 2016, roughly half of renters paid at least 30 percent of their household income towards rent – a proxy for gauging how affordable the rental market is in a community. In comparison, 45.3 percent of renters in the Oklahoma City metro area pay at least 30 percent of their household income towards rent. Stakeholders report that living options just over the Norman city-limit border are much more affordable and are a desirable alternative to the higher housing options in Norman. The provision of affordable multi- family options that are attractive to recent graduates and young professionals as opposed to those enrolled

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma in college will be critical to the community’s ability to effectively retain graduates and create compelling centers of activity that allow residents to live, work, and play in close proximity within the City of Norman.

Norman – and Oklahoma cities in general – has a tax environment where it depends on sales tax. This creates a more competitive environment as cities work to prevent retail leakage and attempt to attract outside expenditures within their city-limits. This strategy often focuses on attracting retail establishments. While this helps to bring in additional revenue and improve the amenities available to residents in the form of shopping, the more sustainable option is to create an attractive community where people want to live. Retailers will follow rooftops and traffic flows. And if talented people are living in a community, the evidence suggests that companies will increasingly follow that talent. Higher quality jobs bring higher disposable incomes, which then ultimately is spent in the communities where those individuals live and work. When people choose to live somewhere that affords a better quality of life or because the available housing options don’t meet their needs or standards, a city losses out on that individual as a taxpayer. But it also losses out on this individual’s potential as an entrepreneur, creator of the next great festival, or future elected leader. They forego the opportunity that this individual may contribute to the community’s ability to realize its vision for a better future. And this is where the conversation so often breaks down in Norman: “Do we have a consensus vision for this community with respect to how we develop?”

To reiterate, Norman must ensure that the lack of unanimity in resident opinion does not impede the process of deriving consensus and advancing reasonable policy. Stakeholders from around the community repeatedly said that Norman needs to “figure out what is wants to be” and felt that the city lacked a cohesive vision. However, a variety of recent efforts have sought to distill public input into a guiding vision for the community. This includes the City’s Comprehensive Plan update, a recent branding study conducted by NEDC inclusive of the aforementioned OU student survey, and the various forms of stakeholder input from this economic development strategic planning process. Through the various forms of public input, the general consensus in terms of future growth and development is that residents want to see Norman evolve into a thriving community that is more than a ”traditional university town; one that is welcoming and inclusive to all backgrounds, capable of offering a compelling quality of place that supports graduate retention and aging in place, and capable of generating more innovative economic activities. Leveraging the results of its OU student survey, VI Marketing and Branding identified four distinct attributes of the Norman brand: diverse, vibrant, inviting, and cultured, with a brand vision of “providing the greatest opportunity for an enriched life.” The accompanying brand position statement was identified as: “To people in pursuit of a high quality of life, Norman is the Southwestern college town that offers more advantages in creating a meaningful existence.” Simply put, the evidence covering migration trends and demographic change, and the input covering talent attraction and retention implies that the community still has work to do in achieving this vision and credibly advancing its brand position. This will require development of new amenities, employment centers, and other community assets like public schools. It will require the redevelopment of many existing areas of the community. And if successful in achieving this vision and brand position, it will attract growth. Communities that provide “opportunity for enriched life” and “advantages in creating a meaningful existence” are ones that people and employers will seek.

January 2017 Page 40

Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma COMPETITIVE SCORECARDS The Community Assessment is accompanied by a set of Competitive Scorecards that demonstrate how the Norman area (as measured by data covering Cleveland County) compares to nine other communities (counties) with which it competes for jobs and workers. Each scorecard evaluates competitiveness across multiple indicators that help measure how the community has performed in key areas that reflect its relative success and ability to attract, retain, and support new jobs and investment. These scorecards, the concepts they measure, and examples of the indicators they include are as follows.

1. Economic Performance: employment, output, wages, income, poverty 2. Workforce Sustainability: age composition, educational attainment, migration 3. Innovation & Entrepreneurship: R&D expenditures, self-employment, small business lending 4. Business Environment: infrastructure, business costs (utility rates, lease rates), labor productivity 5. Quality of Life: crime, commuting, cost of living, health outcomes, recreational amenities

Each of the five scorecards presents a series of rankings (1-10) illustrating the performance of the Norman area (as reflected by Cleveland County) against the following nine counties and communities:

1. Boone County, MO (Columbia, MO) 2. Boulder County, CO (Boulder, CO) 3. Douglas County, KS (Lawrence, KS) 4. Hays County, TX (San Marcos, TX) 5. Johnson County, IA (Iowa City, IA) 6. Lancaster County, NE (Lincoln, NE) 7. Story County, IA (Ames, IA) 8. Washington County, AR (Fayetteville, AR) 9. Washtenaw County, MI (Ann Arbor, MI)

All data for the aforementioned comparisons is collected at the county level unless otherwise indicated. County-level analysis was conducted based on data availability and coverage, and the frequency that site selectors evaluate individual communities at the county (or metropolitan area) level to capture a more regional labor shed and asset base. Scorecards include column headings with the county names and their corresponding principal city in parentheses. Rankings are color-coded with top performers appearing in shades of green, middle-of-the-pack in shades of yellow and orange, and bottom performers in shades of red. A ranking of “1” signals that the community is the top performer but does not necessarily have the highest value (for example, the community with the lowest crime rate would receive a ranking of “1”). Each scorecard is accompanied by a table displaying the data from which the rankings were derived.

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

ECONOMIC PERFORMANCE: RANKINGS

Cleveland Boone Boulder Douglas Hays Johnson Lancaster Story Washington Washtenaw County, OK County, MO County, CO County, KS County, TX County, IA County, NE County, IA County, AR County, MI (Norman) (Columbia) (Boulder) (Lawrence) (San.Marcos) (Iowa City) (Lincoln) (Ames) (Fayetteville) (Ann Arbor) Employment and Unemployment Employment growth rate (one-year) 2015-16 10 7 3 8 1 5 6 9 2 4 Employment growth rate (five-year) 2011-16 8 4 3 9 1 5 6 10 2 7 Unemployment rate 09/17 9 3 1 7 8 6 3 2 3 10 Establishments Establishment growth 2011-16 3 6 5 10 2 4 1 8 7 9 Business bankruptcy rate (per 1,000 est.) 2016 9 1 4 6 8 7 3 2 10 5 Change in business bankruptcy rate 2011-16 8 2 4 9 7 10 6 3 1 5 Exports, Output, and Productivity Exports per worker 2016 8 7 4 9 10 3 2 1 6 5 Gross regional product per worker 2016 5 9 1 10 7 3 4 6 8 2 Wages, Income, and Poverty Wages, salaries, & proprietor earnings 2016 8 7 1 9 10 3 6 4 5 2 Growth in wages, salaries, and earnings 2011-16 3 5 7 10 2 4 9 1 8 6 Per capita income (PCI) 2016 6 5 1 7 8 3 4 9 10 2 Growth in per capita income 2011-16 10 6 2 4 7 8 5 9 1 3 Total poverty rate 2015 1 7 2 10 4 8 3 9 6 5 Child poverty rate 2015 4 9 2 5 7 3 7 1 10 6 Change in total poverty rate 2010-15 2 5 4 10 6 9 3 7 1 8 Change in child poverty rate 2010-15 3 6 4 7 8 10 1 5 2 9 Average Ranking, All Indicators 6.1 5.6 3.0 8.1 6.0 5.7 4.3 5.4 5.1 5.5 Composite Ranking, All Indicators 9 6 1 10 8 7 2 4 3 5

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

ECONOMIC PERFORMANCE: DATA VALUES

Cleveland Boone Boulder Douglas Hays Johnson Lancaster Story Washington Washtenaw County, OK County, MO County, CO County, KS County, TX County, IA County, NE County, IA County, AR County, MI (Norman) (Columbia) (Boulder) (Lawrence) (San.Marcos) (Iowa City) (Lincoln) (Ames) (Fayetteville) (Ann Arbor) Employment and Unemployment Employment growth rate (one-year) 2015-16 -1.3% 1.1% 2.6% 0.7% 6.1% 1.8% 1.4% 0.3% 3.3% 1.9%

Employment growth rate (five-year) 2011-16 7.6% 9.8% 12.3% 6.8% 26.5% 9.1% 9.0% 6.3% 13.7% 8.3%

Unemployment rate 09/17 3.6% 2.3% 1.9% 2.9% 3.0% 2.5% 2.3% 2.0% 2.3% 3.9%

Establishments Establishment growth 2011-16 17.3% 8.7% 13.8% 1.6% 24.1% 16.0% 26.1% 6.2% 6.6% 2.4%

Business bankruptcy rate (per 1,000 est.) 2016 3.0 0.6 1.8 2.7 2.7 2.7 1.7 1.6 3.4 1.9

Change in business bankruptcy rate 2011-16 -1.6 -5.4 -3.9 -0.7 -2.8 0.1 -2.9 -4.7 -8.7 -3.6

Exports, Output, and Productivity

Exports per worker 2016 $103,408 $121,810 $141,177 $97,127 $96,414 $145,225 $151,185 $161,792 $126,860 $138,448

Gross regional product per worker 2016 $93,671 $79,148 $118,723 $76,045 $90,649 $95,918 $95,739 $92,317 $89,513 $98,814

Wages, Income, and Poverty

Wages, salaries, & proprietor earnings 2016 $36,688 $39,949 $57,483 $36,138 $35,713 $45,423 $41,447 $44,490 $42,305 $51,044

Growth in wages, salaries, and earnings 2011-16 14.0% 12.9% 12.6% 9.9% 14.4% 14.0% 11.4% 15.1% 12.0% 12.8%

Per capita income (PCI) 2016 $42,201 $43,292 $63,707 $39,440 $38,912 $47,456 $45,484 $38,469 $36,776 $52,814

Growth in per capita income 2011-16 10.9% 13.0% 23.0% 14.2% 13.0% 12.3% 13.7% 11.2% 23.5% 18.6%

Total poverty rate 2015 11.5% 17.7% 12.3% 19.4% 13.6% 18.3% 13.5% 18.6% 16.9% 14.2%

Child poverty rate 2015 12.8% 14.6% 10.9% 13.2% 14.1% 12.7% 14.1% 9.5% 21.3% 13.4%

Change in total poverty rate 2010-15 -2.0% -1.1% -1.3% 3.8% -0.8% 1.3% -1.3% 0.1% -2.7% 1.2%

Change in child poverty rate 2010-15 -3.3% -2.0% -2.9% -0.6% -0.3% 0.2% -3.5% -2.2% -3.4% 0.0%

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

WORKFORCE SUSTAINABILITY: RANKINGS

Cleveland Boone Boulder Douglas Hays Johnson Lancaster Story Washington Washtenaw County, OK County, MO County, CO County, KS County, TX County, IA County, NE County, IA County, AR County, MI (Norman) (Columbia) (Boulder) (Lawrence) (San.Marcos) (Iowa City) (Lincoln) (Ames) (Fayetteville) (Ann Arbor) Population Growth and Change Population growth rate 2011-16 7 8 4 9 1 3 6 5 2 10

Net migration as % of pop growth 2010-16 3 9 2 5 1 7 10 4 6 8

Labor force growth rate 2011-16 8 6 7 10 1 5 9 3 2 4

% of in-migrants w/ BA degree + 2011-15 10 5 3 2 8 6 9 4 7 1

% of in-migrants w/ no HS diploma 2011-15 7 5 1 3 6 9 8 4 10 2

Labor force participation rate 2015 7 8 6 2 4 3 1 4 10 9

Change in labor force participation 2010-15 3 9 8 5 1 5 4 1 10 7

Employment:population ratio 2016 8 7 6 2 5 3 1 4 9 9

Change in employment:population ratio 2011-16 7 10 9 5 1 6 4 2 7 3

Age Composition

Dependency ratio (25-44/45-64) 2016 7 6 9 3 4 1 7 5 2 8

Workers aged 55+ as a share of total 2016 6 4 7 5 1 8 9 10 2 3

Educational Attainment

% 3- and 4-year olds enrolled in pre-K 2011-15 9 5 1 4 7 2 10 6 8 3

% of 18-24 year olds enrolled in college 2011-15 10 3 7 4 6 2 9 1 8 5

% age 18-24 w/ some college or assoc. 2016 8 3 4 7 10 6 5 1 9 2

% age 25+ w/ associate's degree + 2016 8 6 1 5 9 4 7 2 10 3

% age 25+ w/ bachelor's degree + 2016 9 6 1 5 8 4 7 2 10 3

Change, % 18-24, some college/assoc. 2011-16 1 6 3 10 9 7 4 8 2 5

Change, % 25+, associate's degree + 2011-16 3 10 7 2 9 8 6 1 5 4

Change, % 25+, bachelor's degree + 2011-16 7 10 8 4 9 6 5 1 2 3

Average Ranking, All Indicators 6.7 6.6 4.9 4.8 5.3 5.0 6.4 3.6 6.4 4.8 Composite Ranking, All Indicators 10 9 4 2 6 5 7 1 7 2

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

WORKFORCE SUSTAINABILITY: DATA VALUES

Cleveland Boone Boulder Douglas Hays Johnson Lancaster Story Washington Washtenaw County, OK County, MO County, CO County, KS County, TX County, IA County, NE County, IA County, AR County, MI (Norman) (Columbia) (Boulder) (Lawrence) (San.Marcos) (Iowa City) (Lincoln) (Ames) (Fayetteville) (Ann Arbor) Population Growth and Change Population growth rate 2011-16 6.4% 6.4% 7.2% 6.2% 25.3% 9.6% 6.8% 6.9% 9.7% 4.5%

Net migration as % of pop growth 2010-16 64.9% 49.8% 70.6% 57.2% 80.2% 54.1% 44.9% 64.4% 54.3% 50.4%

Labor force growth rate 2011-16 4.1% 5.6% 5.2% 2.8% 22.3% 6.1% 3.0% 7.4% 14.0% 6.1%

% of in-migrants w/ BA degree + 2011-15 29.5% 48.9% 58.0% 58.4% 33.6% 48.5% 33.4% 56.6% 39.4% 58.9%

% of in-migrants w/ no HS diploma 2011-15 10.7% 9.3% 4.1% 6.3% 9.9% 11.6% 11.5% 7.8% 12.3% 4.7%

Labor force participation rate 2016 66.1% 65.8% 67.5% 71.2% 69.2% 70.7% 72.2% 69.2% 63.2% 63.9%

Change in labor force participation 2011-16 -0.1% -3.4% -2.7% -1.3% 1.8% -1.3% -0.8% 1.8% -3.7% -1.5%

Employment:population ratio 2016 62.4% 63.4% 64.3% 68.6% 65.8% 68.2% 69.5% 65.9% 61.3% 61.3%

Change in employment:population ratio 2011-16 -0.4% -1.6% -0.6% 1.5% 3.4% -0.3% 1.7% 2.9% -0.4% 2.7%

Age Composition

Dependency ratio (25-44/45-64) 2016 1.22 1.24 1.01 1.31 1.26 1.35 1.16 1.24 1.32 1.08

Workers aged 55+ as a share of total 2016 21.6% 21.3% 21.9% 21.4% 19.4% 22.5% 22.5% 22.7% 20.4% 20.9%

Educational Attainment

% 3- and 4-year olds enrolled in pre-K 2011-15 42.6% 49.5% 62.4% 53.2% 49.1% 58.3% 39.4% 49.3% 44.4% 56.0%

% of 18-24 year olds enrolled in college 2011-15 60.2% 74.5% 65.0% 72.8% 67.7% 75.9% 61.1% 84.2% 61.5% 72.0%

% age 18-24 w/ some college or assoc. 2016 70.5% 75.7% 75.7% 73.4% 60.4% 74.4% 74.6% 79.2% 69.9% 76.3%

% age 25+ w/ associate's degree + 2016 42.9% 52.4% 66.6% 58.2% 42.1% 61.8% 51.3% 63.3% 37.6% 62.0%

% age 25+ w/ bachelor's degree + 2016 33.2% 43.9% 60.6% 52.0% 36.1% 54.0% 40.2% 54.8% 32.7% 54.8%

Change, % 18-24, some college/assoc. 2011-16 9.8% -6.5% -0.1% -16.3% -11.8% -7.4% -0.7% -7.6% 8.1% -2.3%

Change, % 25+, associate's degree + 2011-16 4.8% -1.0% 2.6% 6.4% 0.9% 1.7% 3.2% 7.3% 3.4% 4.6%

Change, % 25+, bachelor's degree + 2011-16 2.2% -3.8% 1.6% 3.8% 0.8% 3.3% 3.3% 8.6% 4.1% 3.9%

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

INNOVATION AND ENTREPRENEURSHIP: RANKINGS

Cleveland Boone Boulder Douglas Hays Johnson Lancaster Story Washington Washtenaw County, OK County, MO County, CO County, KS County, TX County, IA County, NE County, IA County, AR County, MI (Norman) (Columbia) (Boulder) (Lawrence) (San.Marcos) (Iowa City) (Lincoln) (Ames) (Fayetteville) (Ann Arbor) Research and Development Activity Patents per 100,000 residents 2015 9 10 2 6 1 5 7 4 8 3 Licensing income received ($, million) 2015 7 3 5 2 N/A 8 4 6 9 1 Licenses & options executed 2015 9 3 4 5 N/A 6 7 2 8 1 Academic R&D expenditures ($, million) 2015 8 7 3 4 10 2 6 5 9 1 Change, academic R&D expenditures 2010-15 8 9 4 6 1 10 2 3 5 7 Startups, Small Businesses, and Self-Employed Self-employment as a % of all jobs 2016 2 7 3 4 1 8 9 5 6 10 Change, self-employment % of all jobs 2011-16 10 4 9 8 3 2 5 6 1 7 Average annual earnings, self-employed 2016 1 7 3 5 4 6 10 2 9 8 Change, self-employed earnings 2011-16 3 8 4 6 2 10 7 1 5 9 % of jobs in firms w/ < 50 employees Q3'16 3 7 1 2 4 8 10 5 9 6 Change, % of jobs, firms w/ < 50 empl. Q3'11-16 5 10 6 8 7 1 4 3 2 9 % of jobs in firms < 5 years old Q3'16 3 5 2 4 1 7 9 6 8 10 Change, % of jobs in firms < 5 years old Q3'11-16 7 9 1 5 6 3 2 4 10 8 Capital Environment Small business loans per 1,000 pop. 2015 9 5 1 8 6 2 7 10 4 3 Change, small business loans per capita 2010-15 4 2 5 9 10 6 7 8 3 1 Average Ranking, All Indicators 5.9 6.4 3.5 5.5 4.3 5.6 6.4 4.7 6.4 5.6 Composite Ranking, All Indicators 7 8T 1 4 2 5 8T 3 8T 5

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Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

INNOVATION AND ENTREPRENEURSHIP: DATA VALUES

Cleveland Boone Boulder Douglas Hays Johnson Lancaster Story Washington Washtenaw County, OK County, MO County, CO County, KS County, TX County, IA County, NE County, IA County, AR County, MI (Norman) (Columbia) (Boulder) (Lawrence) (San.Marcos) (Iowa City) (Lincoln) (Ames) (Fayetteville) (Ann Arbor) Research and Development Activity

Patents per 100,000 residents 2015 19.0 18.9 260.7 44.1 370.0 49.1 22.6 87.2 22.3 217.5

Licensing income received ($, million) 2015 $1.59 $7.95 $6.31 $9.83 N/A $1.50 $6.51 $3.22 $1.15 $78.78

Licenses & options executed 2015 13 74 55 44 N/A 40 38 108 27 164

Academic R&D expenditures ($, million) 2015 $242.4 $246.7 $420.8 $311.4 $47.7 $443.2 $284.4 $306.1 $133.7 $1,369.3

Change, academic R&D expenditures 2010-15 11.1% 3.4% 20.4% 16.2% 56.1% -0.2% 48.7% 22.4% 17.3% 15.6%

Startups, Small Businesses, and Self-Employed Self-employment as a % of all jobs 2016 8.7% 4.7% 7.5% 6.0% 9.0% 4.5% 4.4% 6.0% 5.9% 4.3%

Change, self-employment % of all jobs 2011-16 -0.9% -0.2% -0.5% -0.5% -0.2% -0.2% -0.4% -0.4% -0.1% -0.5%

Average annual earnings, self-employed 2016 $28,904 $26,043 $27,510 $26,819 $27,393 $26,366 $24,824 $28,365 $24,873 $25,645

Change, self-employed earnings 2011-16 3.6% -1.8% 3.1% 1.3% 4.0% -8.75% 0.9% 8.5% 2.4% -1.9%

% of jobs in firms w/ < 50 employees Q3'16 37.0% 31.6% 37.7% 37.1% 35.4% 31.3% 28.4% 32.7% 28.7% 32.5%

Change, % of jobs, firms w/ < 50 empl. Q3'11-16 -0.2% -1.4% -0.4% -1.1% -0.6% 2.0% 0.0% 0.1% 0.5% -1.3%

% of jobs in firms < 5 years old Q3'16 14.4% 11.1% 14.6% 12.0% 16.2% 10.5% 10.3% 10.6% 10.3% 9.7%

Change, % of jobs in firms < 5 years old Q3'11-16 -1.2% -2.0% 0.9% 0.1% -0.8% 0.8% 0.8% 0.4% -2.8% -1.4% Capital Environment Small business loans per 1,000 pop. 2015 12.5 15.6 33.4 13.2 15.6 19.7 15.2 12.1 16.6 19.2

Change, small business loans per capita 2010-15 31.9% 36.6% 11.4% 2.6% -1.4% 6.3% 6.0% 5.9% 35.3% 43.6%

January 2017 Page 47

Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

BUSINESS ENVIRONMENT: RANKINGS

Hays Cleveland Boone Boulder Douglas Johnson Lancaster Story Washington Washtenaw County, TX County, OK County, MO County, CO County, KS County, IA County, NE County, IA County, AR County, MI (San (Norman) (Columbia) (Boulder) (Lawrence) (Iowa City) (Lincoln) (Ames) (Fayetteville) (Ann Arbor) Marcos) Infrastructure

Passenger departures 2017 7 3 1 5 4 10 6 8 9 2

Change, passenger departures 2012-17 10 6 5 7 1 4 8 3 2 9

Air Freight/Mail (LB. in Millions) 2017 9 5 1 3 4 8 6 7 10 2

Change, Air Freight/Mail (LB. in Millions) 2012-17 9 8 6 3 4 7 2 10 5 1

Distance to Airport 2017 2 10 7 8 5 3 9 6 1 4

Number of Class 1 Railroads 2017 4 8 4 1 4 8 1 1 8 4

Business Costs

Commercial electricity costs (cents/kwh) 06/17 2 6 5 7 1 9 4 9 3 8

Industrial electricity costs (cents/ kwh) 06/17 1 8 5 6 2 9 7 9 3 4

Office property asking rent, metro 06/16 7 6 9 4 8 1 3 10 5 10

Industrial property asking rent, metro 06/16 8 6 3 8 7 3 2 4 1 9

Retail property asking rent, metro 06/16 8 2 10 5 7 1 5 10 9 4

Ratio of labor productivity to labor cost 2016 1 9 7 5 10 2 3 4 6 8

Business Climate Perceptions

KPMG/Tax Fndn. Bus. Tax Climate Index 2017 7 3 4 5 2 9 6 9 8 1

CNBC America's Top States for Business 2017 10 7 2 8 1 5 4 5 9 3

Forbes Best States for Business 2017 7 6 3 8 1 4 2 4 10 9

Average Ranking, All Indicators 6.1 6.2 4.8 5.5 4.1 5.5 4.5 6.6 5.9 5.2 Composite Ranking, All Indicators 8 9 3 5 1 5 2 10 7 4

January 2017 Page 48

Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

BUSINESS ENVIRONMENT: DATA VALUES

Hays Cleveland Boone Boulder Douglas Johnson Lancaster Story Washington Washtenaw County, TX County, OK County, MO County, CO County, KS County, IA County, NE County, IA County, AR County, MI (San (Norman) (Columbia) (Boulder) (Lawrence) (Iowa City) (Lincoln) (Ames) (Fayetteville) (Ann Arbor) Marcos) Infrastructure

Passenger departures 2017 1,816,000 6,918,000 28,186,000 5,504,000 6,371,000 566,000 2,177,000 1,236,000 688,000 15,159,000

Change, passenger departures 2012-17 2.3% 13.6% 13.9% 11.0% 40.7% 22.5% 8.3% 27.0% 29.6% 7.0%

Air Freight/Mail (LB. in Millions) 2017 72 160 561 221 181 83 146 137 0 348

Change, Air Freight/Mail (LB. in Millions) 2012-17 0 0 0 0 0 0 0 (0) 0 0

Distance to Airport 2017 21 114 42 51 34 23 58 42 0 25

Number of Class 1 Railroads 2017 1 0 1 2 1 0 2 2 0 1

Business Costs

Commercial electricity costs (cents/kwh) 06/17 $8.29 $11.01 $10.41 $11.04 $8.22 $11.61 $9.44 $11.61 $8.65 $11.07

Industrial electricity costs (cents/kwh) 06/17 $5.43 $8.15 $7.55 $7.60 $5.52 $8.23 $7.99 $8.23 $6.39 $7.22

Office property asking rent, metro 06/16 $16.87 $16.79 $17.74 $14.45 $17.66 $12.08 $12.98 $12.08 $16.05 $17.80

Industrial property asking rent, metro 06/16 $7.72 $5.62 $10.53 $5.22 $7.53 $5.51 $4.96 $5.51 $4.53 $9.47

Retail property asking rent, metro 06/16 $16.99 $12.09 $18.99 $16.40 $16.43 $12.06 $14.36 $12.85 $17.18 $13.89 Ratio of labor productivity to labor cost 2016 $1.98 $1.58 $1.62 $1.73 $1.49 $1.87 $1.85 $1.79 $1.63 $1.60 Business Climate Perceptions KPMG/Tax Fndn. Bus. Tax Climate Index 2017 31 15 16 22 14 40 25 40 38 12

CNBC America's Top States for Business 2017 43 22 6 34 4 15 13 15 41 11

Forbes Best States for Business 2017 22 21 8 25 3 12 4 12 36 28

January 2017 Page 49

Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

QUALITY OF LIFE: RANKINGS

Cleveland Boone Boulder Douglas Hays Johnson Lancaster Story Washington Washtenaw County, OK County, MO County, CO County, KS County, TX County, IA County, NE County, IA County, AR County, MI (Norman) (Columbia) (Boulder) (Lawrence) (San.Marcos) (Iowa City) (Lincoln) (Ames) (Fayetteville) (Ann Arbor) Crime Violent crime rate per 100K residents 2014 7 8 2 N/A 3 4 6 1 9 5 Property crime rate per 100K residents 2014 7 6 5 N/A 3 4 8 1 9 2 Change, violent crime rate 2009-14 5 3 7 N/A 9 4 2 1 8 6 Change, property crime rate 2009-14 3 7 1 N/A 5 2 8 3 6 4 Commuting and Congestion % of commuters who drive alone to work 2016 10 7 1 9 5 2 8 3 6 4 % w/ commute times > 30 minutes 2016 8 1 7 6 10 3 3 2 5 9 Mean travel time to work (minutes) 2016 7 1 7 5 10 3 4 2 6 9 Affordability and Cost of Living Home affordability index 2017Q2 3 1 10 6 7 4 5 2 9 8 % renters spending 30%+ of income 2015 1 3 9 7 6 10 4 8 2 5 Cost of living index 2016 1 4 10 6 7 8 3 5 2 9 Health Physicians per 100K residents 2016 9 3 4 8 10 2 6 7 5 1 % of adults reporting poor or fair health 2015 8 9 2 4 7 3 1 5 10 6 % of adults reporting BMI >/= 30 2013 9 8 1 4 3 2 6 7 10 5 % under age 65 w/out health insurance 2014 8 7 4 6 10 1 5 2 9 3 Recreation Walk Score (Principal City) 2016 9 9 1 5 7 3 3 5 8 2 Recreation/fitness facilities per 1,000 pop. 2014 5 4 1 9 7 7 3 10 6 2 Average Ranking, All Indicators 6.3 5.1 4.5 6.3 6.8 3.9 4.7 4.0 6.9 5.0 Composite Ranking, All Indicators 7 6 3 7 9 1 4 2 10 5

January 2017 Page 50

Community Assessment and Competitive Scorecards (REVISED DRAFT) Norman, Oklahoma

QUALITY OF LIFE: DATA VALUES

Cleveland Boone Boulder Douglas Hays Johnson Lancaster Story Washington Washtenaw County, OK County, MO County, CO County, KS County, TX County, IA County, NE County, IA County, AR County, MI (Norman) (Columbia) (Boulder) (Lawrence) (San.Marcos) (Iowa City) (Lincoln) (Ames) (Fayetteville) (Ann Arbor) Crime Violent crime rate per 100K residents 2014 318.2 342.3 245.8 N/A 252.6 253.7 315.0 127.1 425.8 287.8 Property crime rate per 100K residents 2014 3,146.5 2,974.0 2,371.5 N/A 1,883.0 1,998.0 3,166.4 1,776.1 3,191.4 1851.0 Change, violent crime rate 2009-14 -10.5% -18.5% 1.8% N/A 15.0% -15.3% -25.4% -49.5% 11.3% -0.1 Change, property crime rate 2009-14 -26.6% -9.3% -1.7% N/A -20.0% -5.1% -14.9% -30.6% 3.4% -0.3 Commuting and Congestion % of commuters who drive alone to work 2016 84.2% 79.8% 65.2% 82.1% 78.2% 66.7% 80.4% 71.7% 79.4% 72.4% % w/ commute times > 30 minutes 2016 30.4% 15.2% 28.3% 27.4% 48.3% 17.7% 17.7% 15.6% 25.8% 31.7% Mean travel time to work (minutes) 2016 22.1 17.3 22.1 20.6 31.8 18.5 19.3 17.6 21.1 24.2 Affordability and Cost of Living Home affordability index 2017Q2 235.77 242.86 99.70 210.28 193.99 230.94 217.99 240.94 168.34 187.92 % renters spending 30%+ of income 2015 45.0% 47.2% 60.3% 54.1% 51.6% 61.1% 47.6% 58.8% 46.0% 51.3% Cost of living index 2016 86.0 93.0 146.8 96.0 98.0 102.1 91.7 95.6 88.4 107.4 Health Physicians per 100K residents 2016 139 430 322 169 85 605 200 178 205 607 % of adults reporting poor or fair health 2015 17.5% 17.5% 10.8% 11.8% 17.0% 11.0% 9.8% 11.8% 21.3% 12.4% % of adults reporting BMI >/= 30 2013 30.1% 28.4% 13.4% 24.2% 23.8% 23.0% 26.0% 27.1% 30.6% 24.4% % under age 65 w/out health insurance 2014 13.9% 12.1% 9.9% 11.3% 19.6% 6.7% 10.0% 7.2% 16.9% 7.7% Recreation Walk Score (Principal City) 2016 30 30 58 40 38 43 43 40 32 51 Recreation/fitness facilities per 1,000 pop. 2014 29.0 30.0 63.0 16.0 17.0 17.0 41.0 15.0 25.0 49.0

January 2017 Page 51

Community Assessment and Community Scorecards (REVISED DRAFT) Norman, Oklahoma

COMPETITIVE SCORECARDS: DATA SOURCES

ECONOMIC PERFORMANCE  1-year and 5-year Employment Change: Economic Modeling Specialists Intl. (EMSI)  Unemployment Rate: U.S. Bureau of Labor Statistics (BLS)  5-year Establishments Change: EMSI  Business Bankruptcy Rate per 1,000 Establishments and 5-year Change: U.S. District Courts via Moody’s; EMSI  Exports per Worker: EMSI  Gross Metropolitan Product per Worker: U.S. Bureau of Economic Analysis (BEA); EMSI  Gross Domestic Product 5-year Change: BEA  Wages, Salaries, & Proprietor Earnings and 5-year Change: EMSI  Per Capita Income and 5-year Change: BEA  Total and Child Poverty Rate and 5-year Changes: U.S. Census Bureau, Small Area Income and Poverty Estimates

WORKFORCE COMPETITIVENESS  5-year Population Growth Rate: U.S. Census Bureau, Population Estimates  Net Migration as a % of Population Change: U.S. Census Bureau, Population Estimates  5-year Labor Force Growth Rate: BLS  In-Migrants with Bachelor's Degree+: U.S. Census Bureau, American Community Survey (ACS) 5-year Estimates  In-Migrants with less than a High School Diploma+: U.S. Census Bureau, ACS 5-year Estimates  Labor Force Participation Rate: U.S. Census Bureau, ACS 1-year Estimates  Employment to Population Ratio: U.S. Census Bureau, ACS 1-year Estimates  Dependency Ratio (Age 25-44/Age 45-64): U.S. Census Bureau, Population Estimates  A dependency ratio is a general measure of the sustainability of a workforce. The dependency ratio divides the number of workers aged 25 to 44 by those age 45 to 64, the resulting ratio identifies potential workforce shortages caused by retirements over the next twenty years. A ratio below 1.0 indicates that those aged 45 to 64—those workers who will retire or will be near retirement over the next twenty years—outnumber those aged 25 to 44—those workers who will likely replace vacating retiree positions. A ratio below 1.0 is considered to be unsustainable over the long term, particularly if the occupation or business sector is growing. A ratio above 1.0 indicates that those aged 25 to 44 outnumber those aged 45 to 64. While a ratio above 1.0 is said to be sustainable, workforce availability challenges may still be encountered over the long term, especially in rapidly growing occupations and business sectors.

 Workers Age 55+: EMSI  Percent of 3- and 4-year olds Enrolled in Pre-K: U.S. Census Bureau, ACS 1-year Estimates  Share of Population Aged 18 to 24 Enrolled in College: U.S. Census Bureau, ACS 1-year Estimates  Share of Adults Age 25+ with Associate's Degree+: U.S. Census Bureau, ACS 1-year Estimates  Share of Adults Age 25+ with Bachelor's Degree+: U.S. Census Bureau, ACS 1-year Estimates

INNOVATION AND ENTREPRENEURSHIP  Patents: United States Patent and Trademark Office (USPTO)  Licensing Income Received: Association of University Technology Managers (AUTM) 2015 Survey  Licensing and Options Executed: Association of University Technology Managers (AUTM) 2015 Survey  Total R&D Expenditures: National Science Foundation, National Center for Science and Engineering Statistics, Higher Education R&D Survey

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Community Assessment and Community Scorecards (REVISED DRAFT) Norman, Oklahoma

 Self-Employed Workers: EMSI  Average Annual Wage of Self-Employed Workers: EMSI  Percentage of Employment in Firms with Fewer Than 50 Employees: U.S. Census Bureau, Quarterly Workforce Indicators (QWI)  Percentage of Employment in Firms with Fewer Than 5 Years Old: QWI  Small Business Loans (originations) per 1,000 residents and 5-year Change: U.S. Federal Financial Institutions Examination Council (FFIEC): Community Reinvestment Act (CRA), Moody's Analytics Calculated; U.S. Census Bureau, Population Estimates

BUSINESS ENVIRONMENT  Air Passenger Departures: Federal Aviation Administration (FAA), Research and Innovative Technology Administration Bureau of Transportation Statistics (RITA-BTS)  Freight/Mail (LB. in Millions): Federal Aviation Administration (FAA), Research and Innovative Technology Administration Bureau of Transportation Statistics (RITA-BTS)  Distance to Airport: Google  Number of Class I Railroads: State DOT websites  Commercial Electricity Costs: Energy Information Administration (EIA)  Industrial Electricity Costs: EIA  Class A Office Cost (Per Square Foot in Core City): Loopnet  Industrial Cost (Per Square Foot in Core City): Loopnet  Retail Cost (Per Square Foot in Core City): Loopnet  Ratio of Private Sector Labor Productivity to Labor Costs: EMSI  Indicator is measured by dividing private sector gross regional product (a proxy for labor productivity) in each region by total private sector earnings. This produces a ratio that indicates the amount of output generated for every dollar spent on wages, salaries, supplements, and proprietor income.

 Business Climate Perceptions: Tax Foundation, CNBC, and Forbes

QUALITY OF LIFE  Violent and Property Crime Rate per 100,000 Residents and 5-year Changes: Federal Bureau of Investigation, Uniform Crime Reporting; Moody’s Analytics  Percentage of Commuters who Drive Alone to Work: U.S. Census Bureau, ACS 1-year Estimates  Percentage of Commuters with Commute Times Greater than 30 Minutes: U.S. Census Bureau, ACS 1-year Estimates  Mean Travel Time to Work: U.S. Census Bureau, ACS 1-year Estimates  Home Affordability Index: National Association of Realtors (NAR): Real Estate Outlook; U.S. Census Bureau (BOC); U.S. Bureau of Economic Analysis (BEA); Moody's Analytics Estimated  Renters Spending 30% or More of Income on Rent: U.S. Census, ACS 1-year Estimates  Cost of Living Index: Sperling’s  Physicians per 100,000 Residents: Sperling's  Adults Reporting Fair or Poor Health: County Health Rankings and Roadmaps  Adults Reporting a BMI of Greater than or Equal to 30: County Health Rankings and Roadmaps  Population under Age 65 without Health Insurance: County Health Rankings and Roadmaps  Walk Score (Principal City): Walkscore.com  Recreation and Fitness Facilities per 100,000 Residents: U.S. Department of Agriculture Health Atlas

January 2017 Page 53

Community Assessment and Community Scorecards (REVISED DRAFT) Norman, Oklahoma ENDNOTES i “OU Student Benchmark” Survey, NEDC 2016 “Brand Dig.” Conducted by Evolve Research and VI Marketing and Branding. September 2016. ii “A Long Decade in Higher Education Funding.” Center on Budget and Policy Priorities. August 23, 2017. https://www.cbpp.org/research/state-budget- and-tax/a-lost-decade-in-higher-education-funding

January 2017 Page 54 `

TARGET SECTOR ANALYSIS NORMAN, OKLAHOMA

Submitted by Market Street Services, Inc. www.marketstreetservices.com

February 2018

Target Sector Analysis (DRAFT) Norman, Oklahoma TABLE OF CONTENTS

Project Overview ...... 1 Steering Committee...... 2 Introduction ...... 3 Key Concepts Related to Target Sector Development ...... 4 Strategic Considerations for Target Sector Development ...... 4 Target Sector Analysis: Approach and Methods ...... 5 Key Trends: Economic Composition and Workforce Dynamics ...... 7 Recommended Target Sectors ...... 16 Aerospace ...... 18 Bioscience ...... 23 Energy ...... 27 Information and Technical Services ...... 31 Weather and Radar Technologies ...... 35 Endnotes...... 39

Cover photos sourced from the NEDC website.

December 2017

Target Sector Analysis (DRAFT) Norman, Oklahoma PROJECT OVERVIEW The five-phase research and strategic planning process will last approximately nine months, concluding in May 2018. A diverse Steering Committee comprised of representatives from the public, private, and non- profit sectors will guide the process and ensure that it lays the foundation that will allow people and businesses to thrive and wealth to accumulate in the community.

PHASE ONE: STAKEHOLDER ENGAGEMENT The Economic Development Strategic Plan must be adequately informed by the wants and needs of Norman’s residents, workers, and employers. A series of one-on-one interviews and focus groups were conducted in October 2017. This input is complemented by feedback received from an online survey open to all residents and business in the Norman area that solicited more than 1,600 responses.

PHASE TWO: COMMUNITY ASSESSMENT The Community Assessment will provide a detailed examination of Norman’s competitiveness as a place to live, work, and do business, weaving qualitative feedback from phase one with quantitative analysis to produce a set of “stories” that examine Norman’s past, present, and future with respect to economic competitiveness. This narrative Assessment will be complemented by a set of scorecards that illustrate how the area compares to nine other communities that it competes with for jobs and workers.

PHASE THREE: TARGET SECTOR ANALYSIS The Target Sector Analysis will build upon the Community Assessment by providing a deeper examination of the community’s economic composition. It will specifically identify those sectors of economic activity for which Norman is most competitive and which are most likely to support future job and wealth creation in the years ahead.

PHASE FOUR: ECONOMIC DEVELOPMENT STRATEGIC PLAN Informed by the input and research findings gleaned from phases one through three, the Economic Development Strategic Plan will detail a series of objectives related to the community’s identified challenges and opportunities, and a corresponding set of actions, investments, and initiatives. That can help achieve those objectives and advance economic development in Norman over the next five to ten years. The Plan will be holistic, actionable, measurable, and considerate of relevant best-practice programs, policies, and initiatives from communities around the country.

PHASE FIVE: IMPLEMENTATION PLAN Timely and effective implementation is critical to the ultimate success of the Economic Development Strategic Plan. If the Strategic Plan represents what Norman and its community leadership need to do in order to realize the community’s full economic potential, the Implementation Plan helps define how the community’s leadership can collaboratively, effectively, and efficiently advance implementation. Specifically, the Implementation Plan will prioritize initiatives, formalize timelines for implementation, identify roles and responsibilities for lead and supporting organizations, evaluate financial and staff capacity to support implementation, and define performance metrics to track implementation progress and return on investment.

January 2018 Page 1

Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma STEERING COMMITTEE The following individuals have generously volunteered their time to serve the community and this process by providing strategic guidance, input, and oversight throughout the process, attending seven meetings from October 2017 through May 2018.

INDIVIDUAL REPRESENTING ORGANIZATION Andy Paden (Committee Chair) Moore Norman Technology Center Councilmember Kyle Allison City of Norman Jane Bowen Moore Norman Technology Center Superintendent Joyce Burch University of Oklahoma Councilmember Breea Clark City of Norman Shelley Coleman Cox Norman Chamber of Commerce Dr. Michael Detamore University of Oklahoma Mike Fowler NEDC Board Member Anil Gollahalli NEDC Board Member Patrick Grace, PE NEDC Board Member Shane Hampton University of Oklahoma Steve Ketchum Moore Norman Technology Center Chris Kuwitzky University of Oklahoma Steve Lewis NEDC Board Member, City Manager Scott Martin Norman Chamber of Commerce President Curtis McCarty Norman Chamber of Commerce Chair Nick Migliorino Norman Public School System Superintendent Mayor Lynne Miller City of Norman Daniel Pullin NEDC Board Member Dan Quinn NEDC Board Chair Andy Sherrer Moore Norman Technology Center Board President Jason Smith NEDC President Richie Splitt Norman Regional Health System CEO Commissioner Darry Stacy Cleveland County Chuck Thompson Sooner Centurion Chair Casey Vinyard NEDC Board Member Daren Wilson United Way of Norman

January 2018 Page 2

Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma INTRODUCTION The report – the Target Sector Analysis – represents the second phase of research supporting the development of a new Strategic Plan for Economic Development in Norman, Oklahoma. The previous phase, the Community Assessment, identified six key “stories” that cover the broad range of opportunities and challenges in Norman. This report focuses more narrowly on a specific issue: Norman’s potential to create new jobs and wealth for its residents through “targeting.”

For individuals and households, standards of living are closely linked with economic opportunities. If more people at a variety of skill levels are able to find jobs and earn wages, levels of prosperity will rise. To that end, communities around the country are directing finite resources toward the development of “targeted” business sectors that have the greatest potential to grow jobs and attract investment. This report identifies and profiles the sectors that possess such potential in Norman. It is divided into two sections:

 Key Trends: This section analyzes the existing economic composition and workforce dynamics in the Norman area. High level findings that were presented in the Community Assessment are discussed within the context of targeted growth potential and ability to increase wealth and prosperity. This section introduces the process for identifying the target sectors.

 Recommended Target Sectors: This section presents a set of recommended target sectors for Norman. It was developed from an extensive analysis of the community’s economic composition and competitive position for a variety of business activities. This process included evaluating relevant findings from the Community Assessment and the public input process, conducting an extensive analysis of business sector and workforce data, reviewing previously conducted research, and considering targeted activities at the regional and state level. A “ground up” approach – which focuses on the region’s workforce attributes and other assets that support specific types of economic activity – reveals opportunities and challenges and forms the basis for determining where Norman should be directing its economic development resources. The section includes a brief profile for each target sector, complete with a set of key strategic considerations that can inform the development of the upcoming Economic Development Strategy.

Before moving on, however, it is first necessary to define Market Street’s approach to targeting and establish how this practice differs from other strategic aims that might also lead to economic growth. Communities across the country are pursuing differentiated economic development strategies that seek to support the development of “targeted” business sectors which may benefit from specific competitive advantages afforded by the community, its location, and its asset base. The practice of “targeting” has grown as communities have witnessed the advantages that are afforded to the companies by such agglomerations or “clusters.” The remainder of this introductory section provides this additional context in addition to defining specific terms and outlining various strategic considerations that underpin the included analysis.

January 2018 Page 3

Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

KEY CONCEPTS RELATED TO TARGET SECTOR DEVELOPMENT

CLUSTERS: Agglomerations – or “clusters” – represent groups of interrelated businesses that choose to co- locate. The historical growth of clustered economic activity in areas such as the Silicon Valley, Route 128 in Massachusetts, and the Research Triangle Park in North Carolina are well-developed case studies of cluster development efforts that span decades, efforts which many other regions across the nation seek to mimic. There are countless other examples of smaller, more specialized clusters around the country and the world. Clustering can occur among competing or cooperative firms for a variety of different reasons. A group of suppliers may choose to locate in proximity to a major manufacturer for research and development efficiencies and reduced transportation costs; such is the case with an aerospace cluster anchored by Boeing Defense, Space & Security in St. Louis, Missouri. Other firms may co-locate in a specific area in order to take advantage of a specialized labor pool or to be in close proximity to specific infrastructure.

While the factors that have led to clustering vary tremendously by region and sector, such agglomerations occur over time because a location has an asset base that affords the sector and the companies that operate within them some form of competitive advantage. As the cluster grows, so too do the benefits afforded to the companies within the cluster: the available workforce grows, the potential for collaboration expands, competition may drive down costs, and buyer and supplier networks expand, among other potential impacts.

TARGETS: A targeted sector – or simply a “target”– is any type of business activity that is strategically pursued by an economic development organization and its partners for quality growth and development. That is to say, a “target” is an area where financial and staff resources, and the programs and policies they support, are specifically focused. “Targets” are often those segments of an economy where competitive advantages exist, prospects for future growth are greatest, and return on investment is likely highest. A “target” can be a single business sector with high growth potential or a “cluster” of businesses in related sectors. Many communities choose to target business sectors that are not presently concentrated in their community or characterized by existing competitive advantages. This may be because such activities are rapidly expanding, exhibit potential to become clusters in the years and decades to come, or align with other strategic objectives of the community. The aim of “targeting” is not necessarily to create new clusters of business activity – communities with multiple clusters are rare and tend to be among the nation’s largest and most dynamic economies.

STRATEGIC CONSIDERATIONS FOR TARGET SECTOR DEVELOPMENT UNDERSTANDING YOUR ASSET BASE: Strategic targeting is predicated upon a solid understanding of a community’s strengths and weaknesses, specifically as they relate to the needs of specific business sectors and the companies that operate within them. The factors that medium to large companies consider when evaluating a community as a potential location for a new facility are often referred to as site location factors, site selection factors, or site considerations. These factors vary tremendously by sector. Accordingly, communities that are able to offer such characteristics are better positioned to attract these kinds of operations. Understanding the community’s asset base – inclusive of a wide variety of these potential site location factors – is critical to understanding the community’s competitiveness for various business sectors. Likewise, an understanding of its deficiencies in terms of such site location factors will help the community identify areas that need further investment if the community wishes to transform such deficiencies into future assets.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

A HOLISTIC APPROACH: Target business sectors reflect existing agglomerations of establishments with similar business activities that have likely flourished in a community because of an asset base that aligns with that sector’s primary site location considerations. Other sectors that share similar site location factors may not currently be concentrated in the community, but the aforementioned asset base could make the community an attractive location for these new activities. Accordingly, such sectors represent opportunities where the community may have a particularly high chance for success in marketing and recruitment efforts that seek to attract new corporate investments or relocations that would benefit from the community’s existing asset base.

For decades many communities and their economic development organizations have exclusively associated “economic development” with “business recruitment.” While the recruitment of new companies is an important component of any targeted economic development program, it is only “one leg of the stool.” Any effort to develop target sectors and nurture employment growth within them must focus upon the needs of existing businesses as well as entrepreneurs. Holistic economic development must also address the community or region’s asset base that supports the competitiveness of target business sectors and the companies that operate within them.

TARGET SECTOR ANALYSIS: APPROACH AND METHODS Market Street’s approach to target identification is rooted in a complete examination of the region’s strengths and opportunities, including talent (the occupations and types of knowledge that support the region’s business activities). This comprehensive, interrelated approach stands in contrast to the traditional “top down” approach long utilized in cluster identification and analysis. It recognizes the importance of talent and workforce sustainability to the business community. It is complemented by an evaluation of the region’s business climate, networks, infrastructure, research assets, educational programs, and many other factors that influence site location decisions.

CLASSIFICATION: Our approach defines targets by their North American Industry Classification System (NAICS) codes. Though these codes are used to help quantify important employment trends and activity within each target, they should not be interpreted as rigid definitions of the composition of economic activity within a given target. Classification systems do not adequately capture certain niche technologies and opportunities that may deserve strategic attention in certain communities. We utilize the federal government’s Standard Occupational Classification (SOC) system to classify occupations. SOC codes differ from NAICS in that they quantify worker’s skill categories rather than the employment sector reported by their companies.

TARGET DEFINITIONS AND DATA SOURCES: The selection of NAICS subsectors and SOC occupations used to “define” the employment and skill sets of each target sector is made based on assessments of industrial categories published by the U.S. Bureau of Labor Statistics, U.S. Bureau of Economic Analysis, Economic Modeling Specialists International (EMSI), the U.S. Cluster Mapping Project, the U.S. Employment and Training Administration’s Occupational Information Network (O*NET), the National Center for Education Statistics, CareerBuilder, and other resources. Due to data-reporting protocols and limitations in specificity of industrial classifications, definitions are intended to be approximations of targeted activity.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

GEOGRAPHY: Business and workforce composition information contained within this report is based on an analysis of trends at the zip code level for an area that most closely approximates the City of Norman. This encompasses the following zip codes: 73019, 73026, 73069, 73070, 73071, 73072, and 73068. Additionally, data for the Oklahoma City MSA is also included throughout the report to provide additional context to regional trends. The Oklahoma City MSA encompasses Canadian, Cleveland, Grady, Lincoln, Logan, McClain, and Oklahoma counties.

LOCATION QUOTIENTS: Location quotients (LQs) are used to measure the relative concentration of local employment in a given business sector or occupation. When applied to business sector employment, they measure the ratio of a business sector’s share of total local employment to that business sector’s share of total national employment. A business sector with LQ of 1.0 is exactly the same share of total local employment as that business sector’s share of national employment. When a local business sector has a location quotient greater than 1.0, it signals that the sector is more heavily concentrated locally than it is nationwide. Those sectors with high LQs are often assumed to benefit from one or more sources of local competitive advantage. Location quotients can also be applied to occupational employment in the same manner that they are applied to business sector employment, helping to determine which occupations and corresponding skill sets are highly concentrated in the local workforce.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

KEY TRENDS: ECONOMIC COMPOSITION AND WORKFORCE DYNAMICS

This portion of the Target Sector Analysis focuses on key trends related to the business sector composition and workforce in Norman over the course of the previous decade. It integrates key findings from the Community Assessment, input from stakeholders around the community, and other relevant information, with an extensive quantitative analysis of two types of data: business sector data that is useful in identifying existing and potential clustered activities, and occupational data that highlights talent strengths and deficiencies. Market Street examined hundreds of indicators from each category, evaluated trends over time, and compared the region’s economic composition to that of the regional and national economy. What follows is a succinct summary of the most relevant and important themes and observations that emerged from this research.

An evolving economy with less dependency on the public sector The following table displays a high-level overview of business sector composition in Norman and how it has changed over the past decade relative to the Oklahoma City metro and the national average.

FIGURE 1: ECONOMIC PERFORMANCE BY BUSINESS SECTOR, NORMAN (2006-16) Jobs Location Quotient Change in Jobs (2006-2016) (2016) (2016) # Change, % Change, % Change, % Change, NAICS Business Sector Norman Norman OKC MSA Norman Norman OKC MSA U.S. 90 Government 17,043 (3,442) -16.8% -0.6% 1.5% 1.77 1.28 44 Retail Trade 8,631 2,616 43.5% 8.3% 1.8% 1.33 1.02 72 Accommodation & Food Svcs. 7,721 1,835 31.2% 22.7% 19.1% 1.44 1.08 62 Health Care & Social Assistance 5,799 1,506 35.1% 15.6% 25.4% 0.74 0.92 54 Professional, Scientific, & Technical Svcs. 4,063 1,068 35.7% 20.2% 17.6% 1.01 0.88 56 Admin./Sup. & Waste Mgmt./Remed. Svcs. 3,143 (1,114) -26.2% -5.7% 7.3% 0.80 1.00 81 Other Svcs. (except Public Administration) 3,124 187 6.4% 5.8% 3.1% 1.04 1.04 23 Construction 2,796 (12) -0.4% 4.3% -14.9% 0.83 1.08 31 Manufacturing 2,748 (150) -5.2% -10.2% -12.9% 0.55 0.67 52 Finance & Insurance 1,640 (41) -2.5% 6.1% -3.8% 0.67 0.96 53 Real Estate & Rental & Leasing 1,214 (26) -2.1% -22.3% -5.7% 1.18 0.98 71 Arts, Entertainment, & Recreation 940 478 103.7% 25.2% 16.5% 0.88 0.90 42 Wholesale Trade 933 242 35.0% 4.7% -1.3% 0.39 0.98 51 Information 715 43 6.4% -39.8% -7.7% 0.61 0.69 61 Educational Svcs. 538 4 0.8% 48.4% 25.9% 0.33 0.64 48 Transportation & Warehousing 527 63 13.5% 29.0% 12.1% 0.24 0.84 21 Mining, Quarrying, & Oil & Gas Extraction 411 192 87.3% 24.8% -0.6% 1.65 6.25 55 Management of Companies & Enterprises 298 117 64.8% 92.2% 24.9% 0.34 1.00 22 Utilities 230 (25) -9.8% -1.9% 2.3% 1.04 1.15 11 Crop & Animal Production 210 25 13.7% -27.3% 0.7% 0.27 0.27 Total Jobs 62,725 3,540 6.0% 6.4% 5.0% Source: Economic Modeling Specialists Intl. (EMSI) Location quotients: Location quotients (LQs) measure the relative concentration of regional employment in a given business sector. Specifically, they are calculated by dividing a sector’s share of regional employment by that sector’s share of national employment. A location quotient above 1.0 would indicate that the sector is more heavily concentrated in the region than it is nationally. Color-coding: Employment growth is color- coded such that growing sectors are presented in green text and declining sectors in red text. Those with location quotients greater than or equal to 1.1 are presented with a green triangle. LQs lower than 0.9 are presented with a red triangle, and LQs between 0.9 and 1.1 have a yellow dash.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

As was discussed in the Community Assessment, Norman’s economy has historically been highly dependent on government employment. Norman’s three largest employers are all government entities – the University of Oklahoma, Norman Regional Hospital, and Norman Public Schools. In 2016, roughly 27 percent of all jobs were in the public sector, down from 34.6 percent in 2006. Norman’s major employers are all pivotal pieces to the economy. As such, government employment will continue to be an important source for jobs and economic activity in Norman moving forward. However, budget constraints in recent years at the state level has resulted in the loss of thousands of jobs within the public sector; between 2006 and 2016, total government employment fell by 16.8 percent.

Despite such losses in the public sector, the Norman economy grew at a faster pace than the national average over the past ten years. Total employment increased by six percent compared to the national growth rate of five percent. Job growth was fueled by the private sector which posted strong employment growth across a variety of industries. Norman’s private sector employment increased by 18 percent and job growth impressively outpaced its peer university communities in Ann Arbor, MI; Boulder, CO; and Lawrence, KS. Consequently, Norman’s overall economy has evolved into one that is less dependent on the public sector and into one where the private sector has been driving employment growth.

The second column from the right displays the “location quotient” for Norman in each of the broad business sectors as of 2016. A location quotient measures the concentration of a given sector within a local economy relative to the concentration of that same sector in the national economy. A sector with a location quotient above 1.0 is more heavily concentrated in the local economy than it is in the United States as a whole. Typically, a high location quotient indicates that the region has some level of competitive advantage to justify a higher-than-average concentration of jobs. The location quotient for the Oklahoma City MSA is also provided for additional context regarding the overall region’s economic composition.

Beyond government, Norman has a high concentration of jobs in retail trade, accommodation and food services, real estate and rental and leasing, and mining. The first three sectors are tied to the fact that Norman is home to one of the state’s major universities, the University of Oklahoma. Retail trade and accommodation and food services are a testament to the community’s quality of life offerings while real estate activities are tied to the high share of students that are renters. Roughly half of the real estate jobs are for lessors of real estate. Oil and gas, on the other hand, is a major driver of the state’s economy. It has a large economic impact on the region, but its output and associated employment can be highly cyclical.

While Norman has had success in growing its private sector and decreasing its dependency on the public sector, the economy is still relatively concentrated in just a handful of sectors, many of which are vulnerable to state budgets and consumer discretionary spending. As the Community Assessment highlighted, the lack of quality employment opportunities in Norman was cited as a challenge by a variety of input participants, namely higher skilled jobs that require postsecondary education. A 2016 survey of 300 OU students as part of the “Brand Dig” study found that out of the students that stated that did not want to live in Norman after graduation, 66 percent of them said a good or better job opportunity locally would help convince them to stay in Norman after graduation. While job growth is a positive and important piece to a healthy economy, the composition and quality of jobs is just as important. Moving forward, a stronger, diverse economy would provide new, higher-quality employment opportunities for both existing and potential residents in Norman.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

Health care and retail trade: critical for quality of life but limited in wealth creation potential As can be seen in Figure 1, private sector job growth was largely fueled by retail trade and accommodation and food services. Although these two sectors indicate that there have been improvements to quality of life offerings in Norman, they are primarily locally serving and their growth is largely tied to population growth. In other words, the retail and food service sectors principally recycle or recirculate local wealth, and bring little new wealth into the community except for that which is expended by visitors and non-residents. Additionally, they offer relatively lower paying and lower skilled employment opportunities. The biggest bright spot in the private sector job growth was in health care and professional, scientific, and technical services. Combined, the two sectors added more than 2,500 jobs over the past ten years.

Although the location quotient of Norman’s health care sector suggests that it is less concentrated that the national average, total economic activity in Norman’s health care sector is in fact much greater but is hidden in government employment. Norman Regional Health System (NRHS) is operated by Norman Regional Hospital Authority, a public trust, and therefore falls under the government classification system. NRHS employs roughly 3,000 individuals that are not reflected in the private sector data covering health care.

Even so, like retail trade and accommodation and food services, the health care sector is primarily locally serving. Although Norman Regional has attracted patients from all across the state and has some strong specializations, it is not a magnet for destination health care services. In fact, Norman has a high concentration of key occupations that operate in health care services such as family and general practitioners and surgeons, among others. This high concentration of key occupations is indicative of its position as a health care provider for the region and its strength in health care services. However, few regions are truly able to claim status as a destination medical center. Communities such as Rochester, Minnesota (home of the renowned Mayo Clinic) and Cleveland, Ohio (home to the Cleveland Clinic) are two such examples of communities and health care sectors that consistently and intentionally attract patients from all over the world. With a consumer base that extends well beyond the nearby community, they are able to bring in a significant amount of outside money into the community. In this regard and in the most extreme cases, some destination medical services are considered “medical tourism.” Employment growth in health care jobs in Norman, however, is more closely tied to population growth within the region and therefore has a limit to the amount of additional economic activity it can attract. Its growth is most likely to be fueled by the community’s overall growth; that is to say, efforts that expand jobs in primary, export-oriented sectors will benefit the health care sector and others that are predominantly local-serving.

If Norman is to improve wealth and prosperity in the community, it will need to focus on advancing sectors that are export-oriented and have greater growth potential. Those that are export-oriented are able to bring outside dollars into the community through exported goods and services, and they typically provide higher paying and higher skilled employment opportunities. Export-oriented sectors therefore lead to a greater return on investment when it comes to spending economic development dollars.

With that said, it should be noted that when referring to health care in Norman, it is in regards to health care services. As will be mentioned later, there is a tremendous amount of activity related to life sciences and biotechnology that offer more promising prospects for future quality growth and where return on any kind of targeted economic development investment would be greater. Additionally, all three of the previously mentioned sectors – retail trade, accommodation and food services, and health care services – will continue

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma to play an important role in Norman’s economy in helping to strengthen the quality of life offerings for residents and potential residents in the area. However, strategies to strengthen the retail trade and health care sectors will differ significantly when compared to those that are used for targeted economic growth, where dollars are often spent on recruitment and marketing in pursuit of growth. As previously suggested, the local-serving retail, health care, and food service sectors can benefit most appropriately from strategies that increase the demand for services and products in these sectors, as opposed to strategies that seek to increase the supply (i.e. retail recruitment).

Challenges attracting and retaining well-educated young professionals As the Community Assessment highlighted, Norman’s educational attainment rate is above the state and national averages, however, it trails its peer benchmark set – Ann Arbor, MI; Boulder, CO; and Lawrence, KS. These three comparison communities, which are also home to research universities, have populations where 57 to 77 percent of adults have a four-year degree or higher. In Norman, 43 percent of adult residents have a bachelor’s degree or higher compared to roughly 31 percent at the national level. The differences in the educational attainment rates between Norman and its competitive set is reflective of its current economic composition and has implications on the potential opportunities in the near-term.

In addition to current educational attainment rates trailing competitor communities, there are emerging threats related to Norman’s future workforce competitiveness. These troubling trends were related to net out-migration from Cleveland County to other counties in the metro area, a declining population between the ages of 25 and 44, declining educational attainment levels, and an in-migrant population that is less well- educated than existing residents. These four key takeaways that emerged from the data and were discussed in the Community Assessment have important implications on the community’s workforce sustainability and on the types of economic activity that the community can support moving forward.

The city’s previously discussed economic composition is partially a reflection of its lower educational attainment rates and these emerging trends. Norman has a low concentration in many traditional “white collar” industries such as finance and insurance, information, and management of companies where a four-year degree of higher is usually required of its workers. Instead, there is a high concentration of jobs in industries that require lower skilled jobs and offer lower wages such as retail trade and accommodation and food services. Given the positive relationship between educational attainment rates and earnings, these factors ultimately influence residents’ standards of living. As observed in the Community Assessment, median household income in Norman lies below the national average and that of its benchmark communities, and income growth has significantly trailed the rest of the Oklahoma City metro in the last five years.

Long-term strategies can certainly seek to address these workforce challenges and reverse these trends. For example, some of these emerging threats are influenced by quality of life aspects and generational preferences for the types of communities that young, well-educated workers are seeking. Yet, in the near- term, educational attainment rates and other high-level statistics may put Norman at a disadvantage when compared to other university towns by a site selector at the national level. As a result, this may make attracting companies that demand a higher skilled workforce to Norman more difficult. In today’s economy where skilled and talented workers are top site location considerations, companies increasingly follow the talent. As it stands currently, Norman is facing greater competition from the Oklahoma City metro area for well-educated residents and is showing signs that it is losing its young, well-educated residents.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

High rates of self-employment within a developing entrepreneurial ecosystem While Norman may face some challenges attracting certain companies to the community when competing against Oklahoma City and other communities that are magnets for well-educated young professionals, it has great potential to create and expand jobs locally. To begin with, it has a very strong talent pipeline. From pre-K-12 in Norman Public Schools to the Moore Norman Technology Center to the University of Oklahoma, Norman has tremendous training capacity at every level. The overall variety of offerings can meet the diverse needs of companies that operate in various industries.

Norman has historically had great success in creating locally owned small businesses. In 2016, 11.4 percent of private sector jobs were held by self-employed individuals. This high share of self-employment was nearly four percentage points higher than the national average and almost two percentage points higher than its closest comparison community, Boulder (9.6 percent). Roughly 37 percent of private sector jobs in Cleveland County are at firms with fewer than 50 employees while 28.7 percent of private sector jobs in the Oklahoma City MSA are at similarly sized firms. Additionally, 14.4 percent of jobs were at firms that were less than 5 years; the Oklahoma City metro average was 11.7 percent. These indicators, coupled with others, suggest that Norman has an environment that allows small businesses to grow and thrive.

The data indicates that Norman has a healthy supply of small businesses, a strong training pipeline, and the human capital required to create homegrown businesses. However, input participants reported that more support is needed to foster growth in the startup community. Input participants stated that more resources and access to capital were needed to help start and scale companies in Norman. These reported weaknesses in the community’s ecosystem make retaining both talent and companies in their early stages difficult. Startup 405 seeks to help provide the necessary support for startups and entrepreneurs, but it only recently opened in 2017. Ultimately, its goal is the help foster job growth in businesses with exportable products and services and to better connect the start-up community.

There are numerous assets at the University, many of which are anchored at the Research Campus. This includes the Innovation Hub, a resource for students that is home to the Fabrication Lab, the Center for Entrepreneurship, and the Ronnie K. Irani Center for the Creation of Economic Wealth (I-CCEW). The Princeton Review and the magazine, Entrepreneur, ranked OU’s undergrad program for Entrepreneurs as the 12th best in the nation and its graduate program as the 14th best in the nation in 2018. Over the last five years, graduates from the graduate program have started 16 companies and collectively raised $412 million in funding. From entrepreneurship education to fabrication labs to commercialization and technology transfer offices, the resources supporting potential entrepreneurship by students and faculty at OU are too numerous to exhaustively review herein.

At the state level, the mission of i2E is to invest in entrepreneurs to build successful high growth companies in Oklahoma. It was created in response to an Oklahoma Center for the Advancement of Science and Technology (OCAST) initiative to help entrepreneurs, researchers, and companies commercialize technologies and launch and grow new businesses. They have invested more than $42 million in 180 companies over past 20 years and assisted more than 70 small businesses in Oklahoma. Additionally, SeedStep Angels was founded in 2009 and is a formalized group of Angel Investors that is managed by i2E. It was created to help narrow the capital gap in Oklahoma by making the investment process between early stage companies and member angel investors more efficient.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

These are just a few examples of the capacity that exists today to support successful entrepreneurship in the Norman area. While there are a number of state and regional organization in place to assist entrepreneurs, additional collaboration and assistance in Norman could help to leverage the opportunities available through OU and the research activity occurring there. As discussed in the Community Assessment, R&D expenditures at OU currently trail those at its benchmark communities in Ann Arbor, Boulder, and Lawrence. The University of Oklahoma also trailed the research universities in its competitive set in the areas of patents issued, licensing income received, licenses and options executed, startups, and running royalties, among others. When discussing their desired economic future for the Norman area, the majority of input participants described a more diverse economy that was more heavily connected to the core competencies of students and faculty, and more heavily derived from their research activities. If Norman is to secure its desired future to have a diverse, thriving, and innovation-driven economy, a healthy entrepreneurial ecosystem will be a critical component. This encompasses a wide variety of considerations from the types of supportive services and programming described above to the built environment and place-based amenities that certain startups and small enterprises seek today.

Opportunities to leverage OU in weather and radar technologies Norman’s job growth in professional, scientific, and technical services is a positive sign of the recent increase in the amount of economic activity occurring in sectors that are typically near universities. The location quotients in the benchmark communities, which are also home to research universities, are above average – Ann Arbor (LQ=1.30), Boulder (2.91), and Lawrence (1.22) – and illustrate the high concentration of these quality jobs. Although Norman’s location quotient is roughly equivalent to that of the national average, its growth indicates that the sector is strengthening locally. Employment within this sector can often times stem from university research activities or companies that choose to locate near universities in order to capture their highly educated and skilled workers. Over the past ten years, employment growth within this sector primarily occurred in engineering services, computer systems design and related services, and other professional, scientific, and technical services.

As was discussed in the Community Assessment, research activity and commercialization of technology through the University trails that of other communities home to research universities. Yet, there is tremendous opportunity to foster growth, collaboration, and economic activity around OU’s research activities. For example, while OU touts a number of top programs and accolades, its nationally ranked meteorology program stands out among the rest. The University of Oklahoma’s School of Meteorology is among the largest program in atmospheric sciences in the country and is internationally renowned for its state-of-the-art education, research, and facilities. The school’s programs are co-located with the National Oceanic and Atmospheric Administration (NOAA), Department of Interior, Department of Energy, and several university of strategic organizations which add to the breadth of quality education, training, and experience that it affords its students. The school itself is located on campus on the 5th floor of the National Weather Center. Without a doubt, the University’s strength in meteorology and atmospheric sciences is an exceptional asset that distinguishes it from other communities and universities.

Additionally, OU is home to the Advanced Radar Research Center (ARRC) which resides in the state-of-the- art Radar Innovations Laboratory (RIL) that recently opened in 2015. The laboratory is dedicated to innovations in radar technology and science and is equipped with major test equipment and fabrication equipment to support the research, prototyping, and testing of radar and RF devices. Areas of research

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma include everything from the conceptual and system design to the EM fields and antennas to the signal processing and applications. The development of radar technologies in the ARRC can be applied to various fields, and growth prospects for radar technologies are tremendous. Private sector meteorologists provide one-on-one consultation and more detailed and accurate forecasting for clients such as airlines, event planners, utility companies, and businesses involved in logistics, fleet planning, and just-in-time delivery of goods. Radar technologies have extensive aeronautical, meteorological, and geological applications, with a variety of more specialized uses in fields as diverse as law enforcement and health care.

Regional opportunities to grow life sciences and biotechnology According to the National Science Foundation, the majority of OU’s R&D expenditures are in the field of life sciences. In 2016, OU had more than $140 million in life science-related R&D expenditures, accounting for 54 percent to the University’s total R&D expenditures. Roughly $92 million were in health sciences while $38.7 million were in biological and biomedical sciences. Although much of OU’s health care activities are centered in downtown Oklahoma City at the OU Health Sciences Center, there are opportunities to leverage existing efforts and attract certain biotechnology operations to Norman. Additionally, OU’s Institute for Biomedical Engineering, Science, and Technology (IBEST) is located in Norman at OU’s Research Campus in the new Peggy and Charles Stephenson Research and Technology Center. The Stephenson Research complex is a state-of-the-art facility that houses cutting-edge research in the areas of robotics, genomics, and bioengineering. New opportunities to spur economic activity within this area could be explored.

The city’s claim to biotechnology activities is strengthened by the regional and state level efforts to bolster economic activity in bioscience. Both the state and region have committed to strengthen the biosciences sector by directing economic development dollars towards fostering growth and attracting outside investment and companies. The state has also created a number of policies and incentivizes to help increase investment and spur additional job growth. With so many communities vying for biotechnology companies and research activities, Norman will get a greater return on its efforts to attract new investments and jobs if it is to “piggy back” on these state and regional economic development efforts. Rather than competing with Oklahoma City, Norman would be better suited to work with local and state officials and professionals to help identify which projects would be best fit in Norman. For example, this could include projects where the research and discoveries are occurring in Oklahoma City at the Health Sciences, but a company needs additional space and workers to scale its operations with an eye towards future production facilities. In this regard, Norman may be better positioned for more mature life sciences establishments as opposed to new startups, with its efforts to nurture entrepreneurship and innovation more heavily targeted towards other sectors such as weather and radar.

Manufacturing strengths can be applied to a broader set of operations Although the manufacturing sector is not as heavily concentrated in Norman as the average American community, its exports are a major source for new money and wealth creation in Norman. Exports from the manufacturing sector includes a variety of subsectors, but a significant amount stems from machinery manufacturing, chemical manufacturing (which includes pharmaceutical preparation manufacturing), and computer and electronic product manufacturing. Combined, the three subsectors account for 64.4 percent of all manufacturing exports. Major employers such as Johnson Controls and Hitachi, as well as expanding homegrown successes such as IMMY, are certainly major economic drivers in the community.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

When it comes to opportunities in the near-term for future manufacturing operations, Norman’s asset base lends itself to smaller, precision production operations that can be supported by the city’s occupational strengths and training institutions in place. Norman lacks the necessary industrial land and associated infrastructure to support a large relocation project demanding greater than 50 acres and/or rail service. Secondly, it simply does not have the workforce to absorb a large scale operation at the moment. Norman’s unemployment rate is very low at 3.1 percent in October 2017, the most recent month for which data was available. This is a sign of a tight labor market with little available labor to support a major new facility.

FIGURE 2: TOP 20 OCCUPATIONS IN MANUFACTURING*

Median Location Quotient Jobs Typical Entry Level Hourly Education SOC Description Norman OKC 2016 Earnings 47-2211 Sheet Metal Workers 3.01 3.96 173 $25.64 HS diploma or equiv. 51-2023 Electromechanical Equipment Assemblers 1.93 0.91 36 $16.49 HS diploma or equiv. 51-4081 Multiple Machine Tool Setters/Operators/Tenders** 1.27 1.57 59 $16.00 HS diploma or equiv. 51-2022 Electrical & Electronic Equipment Assemblers 1.19 0.84 102 $14.12 HS diploma or equiv. 51-9011 Chemical Equipment Operators & Tenders 1.18 0.66 34 $17.59 HS diploma or equiv. 15-1133 Software Developers, Systems Software 1.05 0.89 176 $32.06 Bachelor's degree 41-4011 Sales Reps, Wholesale & Man., Tech./Sci. Products 1.01 1.82 138 $25.37 Bachelor's degree 49-9071 Maintenance & Repair Workers, General 0.96 0.84 560 $15.36 HS diploma or equiv. 51-4031 Cutting/Punching/Press Machine Setters...** 0.93 1.22 71 $15.55 HS diploma or equiv. 51-6031 Sewing Machine Operators 0.86 0.60 53 $11.80 No formal education 51-4121 Welders, Cutters, Solderers, & Brazers 0.81 1.31 130 $19.18 HS diploma or equiv. 51-4011 Computer-Controlled Machine Tool Operators** 0.74 1.09 42 $17.21 HS diploma or equiv. 51-1011 First-Line Supervisors of Prod. & Oper. Workers 0.63 0.86 154 $24.54 HS diploma or equiv. 53-7062 Laborers & Freight, Stock, & Mat. Movers, Hand 0.52 0.89 549 $12.56 No formal education 51-4041 Machinists 0.51 0.91 80 $22.24 HS diploma or equiv. 51-9061 Inspectors, Testers, Sorters, Samplers, & Weighers 0.49 0.66 103 $20.06 HS diploma or equiv. 51-9198 Helpers--Production Workers 0.46 0.71 78 $12.70 No formal education 51-9111 Packaging & Filling Machine Operators & Tenders 0.43 0.56 66 $12.09 HS diploma or equiv. 51-2092 Team Assemblers 0.43 0.55 188 $14.52 HS diploma or equiv. 41-4012 Sales Reps, Whole. & Man., Exc. Tech./Sci. Products 0.35 0.68 202 $22.55 HS diploma or equiv.

Source: Economic Modeling Specialists International (EMSI) *Not including management, office, and administration occupations, **Metal & Plastic Location quotients: Location quotients (LQs) measure the relative concentration of regional employment in a given business sector. Specifically, they are calculated by dividing a sector’s share of regional employment by that sector’s share of national employment. A location quotient above 1.0 would indicate that the sector is more heavily concentrated in the region than it is nationally. Color-coding: Employment growth is color- coded such that growing sectors are presented in green text and declining sectors in red text. Those with location quotients greater than or equal to 1.1 are presented in green font. LQs lower than 0.9 are presented with red font and LQs between 0.9 and 1.1 in orange font.

A look at the top 20 production and other-related occupations in the manufacturing sector offers further insight to the manufacturing activities and opportunities in Norman. The occupations are sorted by location quotient, indicating their concentration from highest to lowest. At the bottom of the list are key occupations that are associated with large-scale assembly operations. This includes, team assemblers, packaging and filling machine operators, helpers -- production workers, and laborers. These assembly-oriented workers are not prevalent in the Norman labor force.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

On the other hand, Norman has a high concentration of occupations with more specialized skills. This lends its support for more customized and precision manufacturing operations. Norman has an above average share of workers with skills to fill occupations such as electromechanical equipment assemblers, multiple machine tool setters, electrical and electronic equipment assemblers, and chemical equipment operators and tenders, among others. The Oklahoma City metro area also has strengths in a number of occupations that require workers to have higher, more specialized abilities. These occupations have transferable skills that can be applied to a broader range of manufacturing operations, ones that require a workforce with higher skilled workers. For example, Norman has a particularly high share of workers with competencies in electronics.

Given the location and workforce considerations, Norman has a strong case to attract and grow precision production-related jobs. Additionally, the Moore Norman Technology Center is a local asset that can support many of the training needs for key occupations. Rather than targeting large scale operations, the region’s occupational strengths can be applied to strengthening key industries such as aerospace, weather and radar technologies, energy, and other sectors that are naturally attracted to a larger regional asset base. Economic development activities can use the community’s workforce strengths as a selling point for attracting additional economic activity and specialized manufacturing operations in diverse sectors. Norman’s recruitment and marketing efforts would ultimately have a greater return on investment by focusing on smaller, custom- or precision production facilities within existing regional and state target sectors (i.e. aerospace, energy, etc.) as opposed to simply targeting all manufacturing operations regardless of size, sector, or production process.

Product limitations and the built environment: impact on white collar opportunities Norman’s economic opportunities will also be influenced by perceived and real challenges related to its business environment. As previously mentioned, Norman lacks large, rail-served industrial sites, which would limit the size and type of a manufacturing or distribution project for which Norman could successfully compete. Norman’s product limitations also include a lack of abundant, high quality office product. These factors combined, further support efforts to attract and grow small to mid-size operations. As companies in certain “white collar” sectors increasingly seek mixed-use, walkable environments that are attractive to the next generation of workers, Norman will need to intentionally nurture compelling centers of activity that provide an environment conducive to new class A office development. As national trends show, quality of life enhancements will attract growth in the form of new investments, new residents, new jobs, new companies, and new opportunities to increase wealth and raise standards of living.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma RECOMMENDED TARGET SECTORS In addition to a review of the economic and workforce conditions in Norman, Market Street reviewed the key sectors that are being targeted for economic growth at the regional (by Greater Oklahoma City Economic Development) and state (by the Oklahoma Department of Commerce). This is motivated by the reality that communities, especially those located in a metropolitan region such as Oklahoma City, do not operate in a bubble. Companies that are located in the region benefit from a labor shed that crosses city limits and county lines. Likewise, residents and workers with the appropriate transportation means are also not limited to employment opportunities only in their city. Further, regions and states have other assets and advantages – from infrastructure to incentives – that make larger regions particularly competitive for certain types of activities. Given these facts and the reality that there are finite resources available to put towards targeting economic growth, it is sensible to leverage the resources expended at the regional and state level while giving appropriate consideration to Norman’s niche opportunities and specializations.

The following “key industries” are targeted by the State of Oklahoma: 1. Aerospace & Defense 2. Agriculture & Bioscience 3. Energy 4. Transportation & Distribution 5. Information & Financial Services 6. Manufacturing

The following “key industries” are targeted by Greater Oklahoma City Economic Development: 1. Aviation & Aerospace 2. Biotech 3. Energy 4. Logistics

Clearly and appropriately, there is a great deal of crossover between the two sets of target sectors. The graphic on the following page provides an overview of the process used to identify the target sectors with the greatest potential to support job creation, wealth creation, and realization of Norman’s economic vision for a more diverse and innovative economy. The recommended target sectors for Norman are:

1. Aerospace 2. Bioscience 3. Energy 4. Information & Technical Services 5. Weather & Radar

These recommendations are supported by the observations contained within the Community Assessment, the preceding discussion of economic and workforce trends, and the profiles of sector activity that follow. Within each profile there is an emphasis on the assets and attributes which distinguish Norman and its value proposition within that sector. Each profile concludes with examples of how Norman’s niche – Weather & Radar – can be leveraged in catalyzing innovative activity in the target sector.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

FIGURE 3: IDENTIFICATION OF RECOMMENDED TARGET SECTORS FOR NORMAN, OKLAHOMA

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

Information Weather & Norman's Aerospace Bioscience Energy & Technical Radar Target Sectors Services Aerospace

DEFINITION: The aerospace sector covers production operations and aviation-related services, including manufacturing, maintenance, research and development, training, and other activities that are related to air and space travel. This includes everything from the testing and manufacturing of aircraft parts to the maintenance, repair, and overhaul (MRO) operations for aircrafts.

FIGURE 4: NORMAN AEROSPACE-RELATED SECTOR ACTIVITY, 2006-16 Jobs Location Quotient Change in Jobs (2006-2016) (2016) (2016) # Change, % Change, % Change, % Change, NAICS Business Sector Norman Norman OKC MSA Norman Norman OKC MSA U.S. 3336 Engine, Turbine, & Power Trans. Equip. Man. 46 (5) -10.5% -15.2% -2.4% 1.19 0.20 4881 Support Activities for Air Transportation 37 (4) -10.5% 62.3% 24.9% 0.47 2.15 3333 Comm. & Service Industry Machinery Man. 21 N/A N/A 726.2% -18.2% 0.60 0.25 4812 Nonscheduled Air Transportation 15 N/A N/A 510.8% -3.5% 0.84 1.44 3342 Communications Equipment Man. 13 N/A N/A -34.1% -38.1% 0.38 0.95 3369 Other Transportation Equipment Mfg. 0 0 N/A N/A -15.7% 0.00 0.01 3329 Other Fabricated Metal Product Man. <10 N/A N/A -9.5% -5.2% 0.04 1.73 3364 Aerospace Product & Parts Man. <10 N/A N/A 228.9% 3.3% 0.01 1.24 Total, Subsector 133 8 6.2% 49.8% -3.1% 0.26 1.29 Total, All Jobs 62,725 3,540 6.0% 6.4% 5.0% Source: Economic Modeling Specialists International (EMSI) Location quotients: Location quotients (LQs) measure the relative concentration of regional employment in a given business sector. Specifically, they are calculated by dividing a sector’s share of regional employment by that sector’s share of national employment. A location quotient above 1.0 would indicate that the sector is more heavily concentrated in the region than it is nationally. Color-coding: Employment growth is color-coded such that growing sectors are presented in green text and declining sectors in red text. Those with location quotients greater than or equal to 1.1 are presented in green font. LQs lower than 0.9 are presented in red font and LQs between 0.9 and 1.1 in orange font.

REGIONAL OVERVIEW AND NATIONAL TRENDS: The Greater Oklahoma City metro is home to a number of aerospace establishments that operate in a variety of activities. In the public sector, Tinker Air Force Base and the Federal Aviation Administration’s (FAA) Mike Monroney Aeronautical Center are two of the largest government employers located in the greater region. Establishments involved in maintenance, repair, and overall (MRO) include Boeing, AAR Aircraft Service, Field Aerospace, General Dynamics, Pratt and Whitney, and Tetra Tech EMC. MRO activity is primarily located near Tinker AFB and Wiley Post Airport. Aircraft manufacturing, engineering, and consulting companies employ roughly 650 workers and produce $113 million in total output throughout the region. Air transportation and other aerospace activities such as flight training schools and aerial photography account for the remaining aerospace-related goods and services operating in the greater region.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

Nationally, aerospace employment suffered heavy losses during the recessionary years, but job growth has picked up in recent years. Between 2006 and 2016, jobs in aerospace product and parts manufacturing increased by 3.3 percent. Historically, the aerospace industry has been concentrated in just a few larger centers, such as Seattle and Wichita, but in recent years, the industry has been decentralizing with job growth occurring in many other communities. Employment in aerospace product and parts manufacturing has grown significantly in places like Cincinnati, Waco, and Oklahoma City. Total U.S. exports of aircraft parts reached $56.2 billion, a record amount in 2014. It represented a 10.6 percent increase from 2013. In comparison, total exports from the U.S. increased by 2.6 percent.i According to Southern Business and Development magazine, aerospace projects of at least 200 employees or $30 million in investment reached an all-time high in 2016 the South, a region that encompasses Oklahoma. Growth prospects for the sector along the supply chain are strong; site selectors anticipate more supplier announcements and more international investment in the years to come.

Constant research and development and new technological advancements that improve safety, efficiency, and the quality of components and parts have helped to drive growth within the sector. The 2017 Global aerospace and defense outlook produced by Deloitte expects growth within the sector will continue to be strong.ii Defense budgets in several nations have increased in recent years as demand for defense and military products has grown. This has primarily been driven by increased national security threats and rising global tensions. The commercial aerospace subsector is also expected to have above-average growth rates, driven by increased passenger travel demand, lower commodity prices, and an accelerated equipment replacement cycle. Additional economic activity is also expected to be driven by the growing Unmanned Aerial Systems (UAS) sector.

KEY FINDINGS AND STRATEGIC CONSIDERATIONS  Although Norman’s aerospace sector is less robust than state and regional economic activity, there is great potential and many valuable opportunities to grow jobs within this sector locally. The majority of the aerospace activity in the Oklahoma City metro area is currently clustered in Oklahoma County; Norman’s proximity to these activities is an important site location consideration. This includes activities such as those at Tinker AFB and Will Rogers Airport. Given the economic impact that the aerospace industry has on the state and regional economy, targeted activities will need to focus on where Norman can differentiate itself in a pool of communities vying for a limited number of projects. As previously mentioned, Norman has a number of workforce attributes that would be attractive to certain aerospace companies. Its asset base and occupational strengths make Norman most competitive for smaller operations, potentially suppliers that produce customized parts, as well as radar technology companies that can leverage the asset base supporting the community’s Weather & Radar Technologies cluster.

 Economic opportunities will need to leverage the community’s workforce strengths. For example, while it lacks aircraft mechanics and service technicians, its share of software developers for systems software is slightly above average and has grown by 45.6 percent over the past ten years. Software developers are the third most common occupation in the aerospace product and parts manufacturing sector in the Oklahoma City metro area. Likewise, Norman lacks avionics technicians but has a high concentration of electronics engineers.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

 Norman also boasts a strong talent pipeline that can be leveraged to help support local aerospace economic activity. The University of Oklahoma offers a bachelor’s of science in aerospace engineering which provides graduates with a strong technical background in both theory and applications of solid mechanics, aerodynamics, controls, propulsion, robotics, space science, design and integration. Over the past ten years, there were nearly 300 completions in Aerospace, Aeronautical and Astronautical Engineering programs in Norman. MNTC offers a two part electronics program and provides the education and training for students to earn the Associate Certified Electronics Technician Certificate. Overall, there was a total of roughly 840 completions in degrees and certificates related to electrical and electronics engineering over the past ten years. This bodes well for the community’s competitiveness for production, particularly in the aerospace sector; production processes in a wide variety of manufacturing subsectors are increasingly reliant on electrical skill sets.

 Norman’s low unemployment rate and worker competencies coupled with its industrial site limitations suggest it is unlikely to attract large projects such as an aircraft assembly plant or other large scale project. Instead, Norman would likely have greater success and a greater return on its economic development investment dollar if it were to focus resources on attracting and growing small to medium-size enterprises. For example, Norman would be more competitive to grow jobs in aircraft engine and engine parts manufacturing and other aircraft parts and auxiliary equipment manufacturing. Roughly 40 percent of the greater Oklahoma City’s aerospace product and parts manufacturing inputs are met in-region, suggesting that there could be opportunities to capture some of the supply chain leakage. Likewise, only 7.8 percent of the region’s demand for other aircraft parts and auxiliary equipment products are met in-region.

 Max Westheimer Airport is a general aviation airport and one of two reliever airports to Will Rogers World Airport in Oklahoma City. Its activities center on air transportation and support activities in addition to flight training such as through the Sooner Flight Academy. It’s estimated that Max Westheimer Airport’s total annual statewide economic impact exceeds $37 million and it supports a total of nearly 400 jobs, directly and indirectly. There are currently large tracts of developable land surrounding Westheimer available to support future growth in aviation-related activities. Although the airport could viably compete for some MRO facilities for smaller aircraft, there are many other general aviation airports that provide longer runways and other assets that make them more attractive to aviation-related activities.

 As previously mentioned, this target aligns with the state and regional key industry sectors that are currently being targeted. According to a recent study released by the Oklahoma Aeronautics Commission, Oklahoma’s aerospace and aviation industry has an annual economic impact of around $43.8 billion and employs more than 200,000 people throughout the state. The Greater Oklahoma City Chamber also recently released an industry survey and economic impact assessment of the aerospace industry for the ten-county region. According to the report, there are approximately 230 public and private sector establishments operating in the aerospace industry within the Oklahoma City metro area. Combined, those establishments employ more than 36,600 workers, have a payroll of around $2.7 billion, and produce an estimated $4.9 billion in goods and services. In fiscal year 2015, the Oklahoma City metro area received $1.19 billion in federal contracts directly related to aerospace.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

Additionally, the aerospace industry indirectly supports another 31,000 workers that have a labor income of $1.4 billion, while they produce roughly $3.3 billion in total goods and services.

 Overall, the aerospace industry is a major driver of the regional and state economy and a tremendous source for wealth creation. As such, both the state and the Greater Oklahoma City region have committed to strengthening the aerospace industry. State and local economic development officials have prioritized expansion efforts within the existing aerospace cluster and the state offers a variety of incentives to support its growth, including the Aerospace Engineer Workforce Tax Credit and the 21st Century Quality Jobs Program. Likewise, many local economic development officials in the Oklahoma City metro area are also currently targeting economic growth in aerospace activities.

 Aerospace Engineer Workforce Tax Credit: Aerospace companies hiring engineers in a variety of fields will receive a tax credit equal to five percent of the compensation paid to an engineer until January 1, 2026, or ten percent if the engineer graduated from an Oklahoma college or university (up to $12,500 per employee per year). Additionally, another credit of up to fifty (50) percent of the tuition reimbursed to an employee until January 1, 2026. The engineer hired also receives a tax credit of $5,000 per year until January 1, 2026.

 21st Century Quality Jobs Program: This program offers incentives to businesses with a highly skilled, knowledge-based workforce. For qualifying companies, this unique incentive would pay businesses cash back, up to 10 percent of payroll, for up to ten years for the creation of at least 10 jobs with an average wage of $97,341 annually or higher, depending on county.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

NORMAN’S NICHE EXAMPLES OF WEATHER & RADAR TECHNOLOGY APPLICATIONS WITHIN THE AEROSPACE SECTOR Aerospace is one sector with clear crossover to the Weather & Radar Technology target. The various applications of radar technology within aerospace, and the various applications of weather forecasting and modeling to aviation are immense.

OU was recently awarded a $161 million, nine-year grant by NASA to advance understand of Earth’s natural exchanges of carbon. According to OU’s press release, the NASA Contract is for “a first-of-its- kind Earth science mission that will extend our nation’s lead in measuring key carbon-based greenhouse gases and vegetation health from space to advance understanding of Earth’s natural exchanges of carbon between land, atmosphere and ocean.“ The mission will launch on a commercial communications satellite with the OU’s Geostationary Carbon Cycle Observatory (GeoCarb) in charge of monitoring plant health and vegetation stress and examining the sources and processes that control carbon dioxide, carbon monoxide, and methane in the atmosphere. This work lies at the intersection of the Aerospace, Energy, and Weather & Radar Targets.

Additional research has been conducted or is currently underway that involves the areas of aviation and radar technologies. Researchers from the College of Engineering at OU have worked on projects with the FAA and the OU Department of Aviation to implement differential-GPS based aircraft landing systems and distance measuring equipment.

In addition to the Advanced Radar Research Center, the Intelligent Aerospace Radar Team (IART) is a research and educational group that focuses on innovative system solutions and advanced processing algorithms for multi-functional radars, especially radar technologies used in comprehensive radar sense and avoid for UAS operations. Technologies and applications of radar in aerospace include radar for next generation air-traffic management and monitoring, sense and avoid radar concepts and development, low-cost airborne weather radar sensors for detection and monitoring of different types of hazards in airspace, and new technologies that support radar-sensing improvements, among others.

Advancements in technology for sensors also have applicability to the manufacturing sector. Researchers the OU School of Aerospace & Mechanical Engineering are working with Honeywell Federal Manufacturing and Technologies to do just that. Research and development of smart nanocomposites with autonomous sensing capability aim to provide highly flexible sensors for accurate real-time measurement of mechanical load and structural health condition monitoring.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

Information Weather & Norman's Aerospace Bioscience Energy & Technical Radar Target Sectors Services Bioscience

DEFINITION: Bioscience generally encompasses firms that are engaged in some level of activity related to the research, development, and manufacturing in the fields of biotechnology, pharmaceuticals, biofuels, medical implants, and plant and animal science, among others.

FIGURE 5: NORMAN BIOSCIENCE-RELATED SECTOR ACTIVITY, 2006-16

Jobs Location Quotient Change in Jobs (2006-2016) (2016) (2016) # Change, % Change, % Change, % Change, NAICS Business Sector Norman Norman OKC MSA Norman Norman OKC MSA U.S. Agricultural Feedstock and Chemicals 3251 Basic Chemical Man. 44 44 N/A 46.9% 1.6% 0.75 0.14 3112 Grain & Oilseed Milling 0 0 N/A -81.6% -0.3% 0.00 0.09 3252 Resin, Synthetic Rubber, & Artificial...Man. 0 (19) -100.0% -69.0% -10.6% 0.00 0.08 3253 Pesticide, Fertilizer, & Other Ag. Chem. Man. 0 0 N/A N/A -8.3% 0.00 0.05 Drugs and Pharmaceuticals 325411 Medicinal & Botanical Man. <10 N/A N/A N/A 21.6% 0.05 0.08 325412 Pharmaceutical Preparation Man. 139 139 N/A 1258.6% -10.5% 1.73 0.44 325413 In-Vitro Diagnostic Substance Man. 40 40 N/A N/A 59.1% 4.00 0.62 325414 Biological Product (except Diagnostic) Man. 0 0 N/A 220.4% 22.0% 0.00 0.95 Medical Devices and Equipment 334510 Electromed. & Electrother. Apparatus Man. <10 N/A N/A N/A 7.8% 0.04 0.45 334517 Irradiation Apparatus Man. <10 N/A N/A N/A 13.3% 0.32 0.03 339116 Dental Laboratories <10 N/A N/A -46.3% -12.0% 0.50 0.37 339113 Surgical Appliance & Supplies Man. 19 19 N/A 1.1% 2.5% 0.46 0.19 334516 Analytical Laboratory Instrument Man. 0 0 N/A N/A 9.8% 0.00 0.00 339112 Surgical & Medical Instrument Man. 0 0 N/A 4.2% 11.2% 0.00 0.59 339114 Dental Equipment & Supplies Man. 0 0 N/A -61.1% -0.6% 0.00 0.25 339115 Ophthalmic Goods Man. 0 0 N/A -84.3% -15.5% 0.00 0.13 Research, Testing, & Medical Laboratories 541380 Testing Laboratories <10 N/A N/A -37.2% 14.0% 0.11 0.40 5417 Scientific Research & Development Services 27 (16) -37.3% -36.1% 12.9% 0.10 0.28 Bioscience-Related Distribution 424210 Drugs & Druggists' Merch. Wholesalers <10 N/A N/A -2.1% -4.5% 0.03 0.67 424910 Farm Supplies Merchant Wholesalers <10 N/A N/A 13.5% 5.8% 0.02 0.36 423450 Med., Dental, & Hosp. Equip...Wholesalers 0 0 N/A -16.1% 8.7% 0.00 0.77 Total, Subsector 269 112 71.3% -11.8% 4.7% 0.28 0.37 Total, All Jobs 62,725 3,540 6.0% 6.4% 5.0% Source: Economic Modeling Specialists International (EMSI) Location quotients: Location quotients (LQs) measure the relative concentration of regional employment in a given business sector. Specifically, they are calculated by dividing a sector’s share of regional employment by that sector’s share of national employment. A location quotient above 1.0 would indicate that the sector is more heavily concentrated in the region than it is nationally. Color-coding: Employment growth is color-coded such that growing sectors are presented in green text and declining sectors in red text. Those with location quotients greater than or equal to 1.1 are presented in green font. LQs lower than 0.9 are presented in red font and LQs between 0.9 and 1.1 in orange font.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

REGIONAL OVERVIEW AND NATIONAL TRENDS: The Oklahoma City region has a number of resources, programs, and organizations in place to help foster growth with in the life sciences and biosciences field. For example, Oklahoma BioScience Association (OKBio) was created in 2008 with the mission of promoting the growth of biosciences in Oklahoma through partnership building, education and outreach, networking, policy development and publicity. Larger organizations such as OKBio are able to send delegations to conferences such as the BIO International Convention to promote biotechnology and life sciences on behalf of the state and region. The greater Oklahoma City area and state ultimately make a bigger impact through such collective efforts marketing the region.

The tremendous amount of growth in biotechnology and medical research is unlikely to stall any time in the near future. It encompasses such a wide range of economic activity from medical device manufacturing to research and development to DNA sequencing to agricultural chemicals and feedstock. The vast array of economic activity and research, development, and applications are in high demand and growing. Demand for health care services will continue to grow as the United States and global population ages. An aging population will help to further drive medical innovation and new and improved technological and medicinal services and products.

There are a number of bioscience companies currently located in Norman. A sampling of local companies and various bioscience-related activities is provided below.

 Avara, previously operating as Astellas, manufactures pharmaceutical products such as oral solid dosage forms. It has over 300,000 square feet of building space in Norman and serves dosage form development, commercial manufacturing, formulation, analytical laboratories, and warehousing. The site has the capacity to manufacture over two billion tablets a year.

 Health Engineering Serivces specializes in the distribution and servicing of the Unguators and the Unguator accessory line. The Unguator and its accessory line are distributed to compounding pharmacies and laboratories throughout the US and Canada.

 IMMY, a company that develops and makes diagnostic kits that are sold to hospitals and clinics around the globe. It operates out of 45,000-squaer-foot facility near the Max Westheimer Airport in Norman and employs 70 people.

 Linear Health Sciences, a medical device company and developer of the Orchid Safety Release Valve. Its proprietary, breakaway safety-valve technology can be attached to a variety of products and types of medical tubing. In December 2017, it announced additional investment funding of $1.5 million, bringing the company’s total financing to nearly $3million.

 Simergent, a Norman-based medical device startup company, has developed an easy to use, affordable, home dialysis device for emerging market countries. It recently received $1.2 million investment, include $500,000 from the Oklahoma Seed Capital Fund and around $120,000 from the SeedStep Angels, an Oklahoma investment group managed by i2E.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

KEY FINDINGS AND STRATEGIC CONSIDERATIONS  Norman’s competitive advantage in the fields of biological and biomedical science fields have facilitated growth in bioscience in the greater Oklahoma City region. Research taking place at OU has helped to launch a number of research and manufacturing firms in the area. Norman’s workforce competencies and regional assets lend themselves to support economic activity across the whole spectrum of life science companies, from research and development to advancing new products through the production and scaling stage.

 However, while much of the bioscience activity is in Oklahoma City, Norman has a strong case to assist companies in scaling their operations, especially when it comes to manufacturing new products and technologies. The proximity to the research being conducted in Oklahoma City is an important factor, but so too is the availability of smaller industrial sites that could provide attractive locations for startups to scale within the metro area. IMMY is great example of a homegrown bioscience company that has successfully scaled its operations in Norman.

 Likewise, Norman’s occupational strengths in computer and information research scientists (LQ=2.45) supports competitiveness for bioinformatics or bioinformation projects. Additional occupational support could be provided by systems software developers; jobs in this occupation have grown from 121 jobs to 176 over the past ten years in Norman.

 Additionally, Norman has an extremely high concentration of jobs in many health care services occupations. This is primarily due to Norman Regional Hospital and the University. This includes occupations such as respiratory therapy technicians (LQ=4.61), psychiatric technicians (3.67), biological technicians (2.86), ophthalmic medical technicians (2.38), medical records and health information technicians (2.12) and dietetic technicians (1.81), among others. Although the majority of these individuals are engaged in the delivery of health care services, these specialized skill sets and technical positions are often needed in product development and testing environments for pharmaceuticals, medical devices, and a wide variety of other bioscience products.

 The University of Oklahoma Health Sciences Center is comprised of seven medical schools and is a major driver of the state’s biosciences industry. The 30 institutions on its campus bring in more than $53 million in NIH funding. Overall, life sciences accounted for more than half of the University of Oklahoma’s R&D expenditures in 2016, while another 10.8 percent was in the field of engineering. OUHSC has multiple areas of research expertise including in areas such as geriatric medicine, ovarian cancer, and immunology.

 The Stephenson Life Sciences Research Center recently opened in 2010 in Norman. It provides the Department of Chemistry and Biochemistry with 160,000 square feet of state-of-the-art, highly-flexible research laboratories and office space. The $75 million facility also aids in the further development of the University’s research strengths in genomics and integrative life sciences. It includes space for joint projects with industry, core research support facilities to serve the entire campus, and the infrastructure to foster more collaboration with the OU Health Sciences Center.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

 University Research Park, a part of the University of Oklahoma Health Sciences Center, is located in Oklahoma City and consists of more than 700,000 square feet of biomedical research lab and office space and state-of-the-art communications and infrastructure systems. It sits on a 23-acre, $100 million site that is home to around 40 science-based companies. Its mission is to grow biomedical research in Oklahoma. The OU Health Sciences Center’s 2015-2020 research strategic plan includes prioritizing efforts to commercialize its research. It includes an action item to support a sooner-to- market pipeline for assisting faculty with intellectual property development and commercialization.

 The Oklahoma Medical Research Foundation (OMRF), an independent medical research institute, recently celebrated its 70th anniversary. Its staff of more than 300 scientists conduct biomedical research and explores human diseases such as Alzheimer’s, brain diseases, cancers, diabetes, and lupus, among others.

 The state offers the Small Employer Quality Program incentive which would likely cover some bioscience companies. The program provides quarterly incentive payments to a qualifying small employer (90 employees or less). Quarterly payments may be as much as 5% of new taxable payroll for up to 7 years. Qualifying payroll must be attributable to annual salaries that are at least 110% of the average wage of the county in which the jobs are located. Qualifying companies must also attain 75% out of state sales. For Cleveland County, a salary of 110% would be $37,167. It has an out-of-state sales requirement where 75 percent or more of the company’s sales must be out-of-state, but research and development companies and testing labs are excused from the requirement.

NORMAN’S NICHE EXAMPLES OF WEATHER & RADAR TECHNOLOGY APPLICATIONS WITHIN THE BIOSCIENCE SECTOR The Biomedical Engineering Lab is located in Norman at the Stephenson Research and Technology Center. Its facilities include laser Doppler interferometer, material testing systems (MTS), microscopes, signal analyzers, data acquisition system, sound delivery and monitor system, surgical suite with surgical microscopes, drilling system and irrigation/suction apparatus for human temporal bone and animal studies, microtome for histology study, tympanometer, freezers, computers, various engineering software packages, among other equipment. Relevant research activities in the OU School of Aerospace and Mechanical Engineering (AME) include biomechanics and 3D printing of human and animal ears with materials mimicking bone and soft tissue. The Doppler interferometer and its applications to medical imaging are a good example of the crossover between the community’s strengths in Weather and Radar Technologies and other targeted economic activities like bioscience.

Radar technology can be used in a variety of specialized ways in bioscience and health care applications, from diagnostics related to the auditory system and circulatory system to the integration of radar technology in medical devices and sensors, including “smart” devices that measure patient health conditions. Radar technology has recently been used by NASA and other partners to aid in search and rescue efforts by detecting human heartbeats beneath rubble in the wake of an earthquake or other natural disaster.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

Information Weather & Norman's Aerospace Bioscience Energy & Technical Target Sectors Radar Services Energy

DEFINITION: Oklahoma’s economy has a long history of economic success in energy and its energy sector has diversified from traditional energy sources to those in clean and unconventional sources energy. The region’s strengths in energy range from oil and gas extraction to manufacturing of oil and gas equipment and machinery to surveying and mapping services.

FIGURE 6: NORMAN ENERGY-RELATED SECTOR ACTIVITY, 2006-16 Jobs Location Quotient Change in Jobs (2006-2016) (2016) (2016) # Change, % Change, % Change, % Change, NAICS Business Sector Norman Norman OKC MSA Norman Norman OKC MSA U.S. 213112 Support Activities for Oil & Gas Operations 282 154 120.0% -3.5% 18.5% 3.36 6.68 2211 Electric Power Generation, Trans. & Dist. 182 (22) -10.6% -13.7% 0.1% 1.16 1.02 237130 Power/Comm. Line & Related Structures Construction145 37 34.3% 46.9% 26.5% 2.02 1.03 2111 Oil & Gas Extraction 113 39 51.8% 93.0% 27.6% 1.61 11.60 237120 Oil & Gas Pipeline & Related Struct. Const. 62 12 23.3% 298.8% 53.7% 1.16 1.52 541370 Surveying & Mapping (exc. Geophys.) Serv. 54 (13) -19.2% -3.7% -29.7% 2.77 1.53 2212 Natural Gas Distribution 48 8 20.6% 33.6% 5.5% 1.08 1.95 541360 Geophysical Surveying & Mapping Services 25 11 87.2% 65.7% -17.0% 3.88 4.53 333132 Oil & Gas Field Machinery & Equip. Man. 22 N/A N/A 75.2% 5.6% 1.00 8.28 213111 Drilling Oil & Gas Wells 11 N/A N/A -22.7% -42.1% 0.56 9.05 Total, Subsector 943 259 37.8% 28.9% 8.4% 1.73 4.00 Total, All Jobs 62,725 3,540 6.0% 6.4% 5.0% Source: Economic Modeling Specialists International (EMSI) Location quotients: Location quotients (LQs) measure the relative concentration of regional employment in a given business sector. Specifically, they are calculated by dividing a sector’s share of regional employment by that sector’s share of national employment. A location quotient above 1.0 would indicate that the sector is more heavily concentrated in the region than it is nationally. Color-coding: Employment growth is color-coded such that growing sectors are presented in green text and declining sectors in red text. Those with location quotients greater than or equal to 1.1 are presented in green font. LQs lower than 0.9 are presented in red font and LQs between 0.9 and 1.1 in orange font.

REGIONAL OVERVIEW AND NATIONAL TRENDS: Oklahoma City is home to the headquarter operations for a number of companies in the oil and gas sector such as Devon, Chesapeake Energy, Continental Resources, and SandRidge Energy, to name a few. There are hundreds of energy companies within the greater area including large and small independents, midstream companies, service businesses, startups and spinoffs. According to a recent Economic Study of the industry in Oklahoma, the oil and gas industry produced on average 37.1 billion in output of goods and services annually between 2010 and 2015. iii

While there is a tremendous amount of economic benefit associated with the oil and gas sector, the industry is also very volatile. In recent years, the overall energy sector suffered heavy losses as result of falling crude oil prices in 2014, and the state of Oklahoma was hit hard by the decline in the energy sector. The national rig count fell to its lowest number in seven decades and drilling activity in Oklahoma fell be 59 percent.

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However, the energy sector is continuing to recover and the outlook is positive. During the first week in January, crude oil prices reached their highest level in more than three years and U.S. crude oil refinery inputs reach a record high in December. Growth in manufacturing activity is helping to drive crude oil and petroleum product demand. iv The U.S. Energy Information Administration expects U.S. crude oil production to surpass 10 million barrels per day in February 2018. The oil and gas industry is also undergoing transformative changes, driven by consumer demand, changing political environments, new technological advancements and a new focus on more long-term growth opportunities which should strengthen the industry and open up new opportunities for economic growth. Meanwhile, continued innovation in alternative energy conversion, transmission, and storage is creating new markets for consumers and producers.

KEY FINDINGS AND STRATEGIC CONSIDERATIONS  Energy is a major source for new money in a community given that it is so heavily export-oriented. Oil and gas extraction accounted for the second-largest share of Norman’s exports in 2016, following just state government in total exported goods and services. In 2016, Norman exports in oil and gas extraction totaled nearly $570 million, a major source of new wealth for the community.

 Norman’s proximity to hundreds of energy companies and operations make it an attractive place for companies in the energy field. Oklahoma has five petroleum refineries with a combined capacity of more than 500,000 barrels per day, or roughly three percent of the total US capacity. The state is also home to the new GE Oil & Gas Technology Center. The Center opened in 2016 and is the first GE global research center to focus on only one industry. Future advancements in applied technology look to make the oil and gas industry more efficient. The Center will provide the ability for commercialization of new technology and new approaches at a faster pace.

 The GE Oil & Gas Technology center is likely to attract other technology-focused industry and research companies. For example, GE recently unveiled a prototype drone that is engineered to detect emissions precisely and cost-effectively. It aims to help customers reduce environmental impact and improve operational efficiency in the oil and gas industry. The cross sector applications in such innovations lend themselves to spur additional economic activity in the areas of aerospace, transportation, and others. Norman’s proximity to this growing cluster can be leveraged to capture opportunities in smaller, precision manufacturing operations and potential collaborations in other industry strengths.

 Local employers include Bergey WindPower Co and Cimmarron Energy, among others. Bergey WindPower Co is the nation’s oldest manufacturer of small wind turbines. The company designs and manufactures residential-sized wind turbines. Its product line includes grid tied turbines, off grid turbines and tower options. Cimarron Energy designs and manufactures natural gas production and processing equipment. Its equipment provides separation, flowback, and environmental products to oilfield exploration and production companies.

 Norman’s talent pipeline produces a high number of quality petroleum engineers each year. The University of Oklahoma’s petroleum engineering program is consistently ranked as one of the best in the country. Its undergraduate program ranked third best in the country according to a recent US

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News and World Report ranking and its graduate petroleum engineering program tied for 6th. Between 2006 and 2016, there were roughly 1,200 degree completions in petroleum engineering. Petroleum engineering is another example of a skill set with potentially cross-sector applications as engineers engaged in the discovery and efficient extraction of energy resources are increasingly utilizing information technologies for big data analysis (Norman’s Information and Technical Services target) and radar technologies that improve remote sensing (Norman’s Weather & Radar Technologies target).

FIGURE 7: TOP OCCUPATIONS IN ENERGY-RELATED SECTORS, NORMAN Jobs Location Quotient Median (2016) (2016) Typical Entry Level Hourly Education SOC Occupation Norman Norman OKC MSA Earnings

47-1011 First-Line Supervisors of Const. Trades & Extr. Workers 270 1.07 1.57 $24.77 HS diploma or equiv. 17-3031 Surveying & Mapping Technicians 56 2.42 2.16 $15.58 HS diploma or equiv. 47-5071 Roustabouts, Oil & Gas 34 1.71 5.02 $18.40 No formal education 17-1022 Surveyors 32 1.77 1.34 $19.98 Bachelor's degree 49-9012 Control & Valve Instal. & Repairers, Exc. Mech. Door 28 1.52 2.49 $23.61 HS diploma or equiv. 17-2171 Petroleum Engineers 24 1.77 7.42 $44.55 Bachelor's degree 19-4041 Geological & Petroleum Technicians 22 3.67 8.20 $21.12 Associate's degree 47-5012 Rotary Drill Operators, Oil & Gas 16 2.55 8.69 $26.67 No formal education 47-5011 Derrick Operators, Oil & Gas 14 3.19 10.33 $21.67 No formal education 17-2151 Mining & Geolog. Eng., Incl. Mining Safety Engineers <10 2.94 6.36 $41.38 Bachelor's degree 51-8093 Petro. Pump System Oper., Refinery Oper., & Gaugers <10 0.22 1.45 $26.28 HS diploma or equiv. 53-7071 Gas Compressor & Gas Pumping Station Operators <10 1.42 5.48 $29.53 HS diploma or equiv. 53-7072 Pump Operators, Except Wellhead Pumpers <10 0.89 1.36 $22.53 HS diploma or equiv. 53-7073 Wellhead Pumpers <10 1.91 3.69 $28.63 HS diploma or equiv. 47-5021 Earth Drillers, Except Oil & Gas <10 0.84 1.48 $15.98 HS diploma or equiv. Source: Economic Modeling Specialists International (EMSI) Note: data is for total occupations across all industries, not limited to those in the energy-related subsectors listed in the target. Location quotients: Location quotients (LQs) measure the relative concentration of regional employment in a given business sector. Specifically, they are calculated by dividing a sector’s share of regional employment by that sector’s share of national employment. A location quotient above 1.0 would indicate that the sector is more heavily concentrated in the region than it is nationally. Color-coding: Employment growth is color-coded such that growing sectors are presented in green text and declining sectors in red text. Those with location quotients greater than or equal to 1.1 are presented in green font. LQs lower than 0.9 are presented in red font and LQs between 0.9 and 1.1 in orange font.

 The energy sector provides many high-wage employment opportunities. Average wages range from $41,415 in the surveying and mapping sector up to $98,261 in the electric power generation, transmission and distribution sector. Additionally, it provides well-paying jobs for workers at every skill and educational attainment level. Median hourly earnings for a full-time worker in the top occupations in energy range from $32,416 for a surveying and mapping technician where a high school diploma is typically sufficient to fill an entry level position, all the way up to $92,669 for a petroleum engineer where a bachelor’s degree is required.

 Oklahoma is the third-largest producer of wind power in the country. According to a recent report by the American Wind Energy Association, Oklahoma’s current construction activity has put it on pace to overtake Iowa by the end of 2017 to become the second-ranked state in installed wind power

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

capacity.v In 2016, the wind industry supported between 8,000 and 9,000 direct and indirect jobs and total capital investment exceeded $12 billion.vi

 AEP recently invested $4.5 billion into the Wind Catch Energy Connection Project, a 2,000-megawatt wind farm in the panhandle and dedicated power line to deliver energy produce by the turbines. It will serve Public Service Company of Oklahoma and Southwestern Electric Power Company customers.

 Norman’s proximity to the nation’s “Wind Corridor” – which extends from southern Texas to the northern Minnesota – not only lends itself as a valuable attribute to the production and research side of economic activities related to wind power, but it can also provide opportunities for manufacturers. Norman’s location near the country’s most favorable sites for wind power generation could enable manufactures to reduce transportation costs along the supply chain. There are currently over 500 manufacturing facilities in the country producing products from the wind industry. Products include blade, tower, and turbine assembly facilities, in addition to raw component suppliers such as fiberglass and steel.

 Faculty at the University of Oklahoma are focused on researching novel materials and structures for applications in next generation solar cells. Additionally, OU faculty are active members in the Oklahoma Photovoltaics Research Institute, a statewide consortium focused upon education and research programs related to next generation solar cells. The primarily goal of the institutions is to foster collaboration across the state in research, education, and outreach related to photovoltaics (PV). The institutes comprises faculty members for physics, chemistry, materials science, and engineering at the state’s three major research universities – OSU, OU, and UT.

NORMAN’S NICHE EXAMPLES OF WEATHER & RADAR TECHNOLOGY APPLICATIONS WITHIN THE ENERGY SECTOR With technological advancements, wind and solar power are projected to grow which should lead to more demand for atmospheric scientists. Utility companies will depend more heavily on weather forecasting when it comes to buying and selling wind, solar, and other clean energy sources whose sources vary with the weather in order to known when to buy or sell power depending on the supply. Likewise, companies operating in the production of clean energy power will depend on analytics to determine optimal locations for solar and wind installations. Similarly, advancements in solar panels and photovoltaics research will likely create additional demand for atmospheric scientists to assist in site locations and optimal positioning for solar fields. Analysis of wind and solar power potential is an area at the intersection of the weather and radar, energy, and information and technical services targets.

Interestingly, the energy sector and the weather and radar technology sectors have intersected as wind farm proliferation has interfered with radar technologies used to predict weather and guide aircraft. The U.S. Department of Energy seeks to develop strategies that mitigate interference, increasing the need for effective siting of wind farms.

Radar technologies and interferometry are also used in the energy sector to support remote sensing needs from the identification of faults and fractures to the mitigation of oil spills.

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Information Weather & Norman's Aerospace Bioscience Energy & Technical Target Sectors Radar Services Information and Technical Services

DEFINITION: Information and Technical Services includes economic activities that leverage technology both in providing services and in the manufacturing of relevant equipment. Part of the growth within this sector is attributed to the increase in activities related to “shared services.” For example, in an effort to decrease costs by eliminating duplicate activities and creating new efficiencies, companies have been outsourcing certain functions (such as payroll) or consolidating them into a handful of vertically integrated business units for decades. Other applications include data analysis and software as a service (SaaS) such as cloud computing software services.

FIGURE 8: NORMAN INFORMATION & TECHNICAL SERVICES-RELATED SECTOR ACTIVITY, 2006-16 Jobs Location Quotient Change in Jobs (2006-2016) (2016) (2016) # Change, % Change, % Change, % Change, NAICS Business Sector Norman Norman OKC MSA Norman Norman OKC MSA U.S. 5413 Architectural, Eng., & Related Services 930 429 85.4% -7.5% 0.6% 1.57 0.84 5412 Accounting, Tax Prep., Bookkeeping… 576 (15) -2.5% 52.5% 8.9% 1.26 1.54 3341 Computer and Peripheral Equipment Man. 374 114 43.7% 17.2% -16.7% 5.75 1.13 541512 Computer Systems Design Services 309 89 40.7% 72.9% 62.7% 0.78 0.34 541511 Custom Computer Programming Services 289 173 148.1% -0.6% 48.7% 0.79 0.53 54171 R&D in the Phys., Eng.g, & Life Sciences 24 (10) -29.1% -36.7% 15.2% 0.10 0.29 541519 Other Computer Related Services 24 N/A N/A 203.6% 0.9% 0.49 2.05 541618 Other Management Consulting Services 21 (19) -47.4% -2.5% 10.5% 0.47 0.64 541513 Computer Facilities Management Services 10 (20) -66.8% 80.6% 20.2% 0.35 0.76 Total, Subsector 2,557 765 42.7% 20.0% 18.0% 1.14 0.81 Total, All Jobs 62,725 3,540 6.0% 6.4% 5.0% Source: Economic Modeling Specialists International (EMSI) Location quotients: Location quotients (LQs) measure the relative concentration of regional employment in a given business sector. Specifically, they are calculated by dividing a sector’s share of regional employment by that sector’s share of national employment. A location quotient above 1.0 would indicate that the sector is more heavily concentrated in the region than it is nationally. Color-coding: Employment growth is color-coded such that growing sectors are presented in green text and declining sectors in red text. Those with location quotients greater than or equal to 1.1 are presented in green font. LQs lower than 0.9 are presented in red font and LQs between 0.9 and 1.1 in orange font.

REGIONAL OVERVIEW AND NATIONAL TRENDS: Jobs within the information and technology field have been growing rapidly both in the metro area and nationwide. Employment in the sector grew by more than triple the rate of total job growth in the Oklahoma City MSA and across the country. Advancements in technology have been a driving force for economic activity in information and technical services. Technological advancements have enabled companies to more efficiently and effectively reach clients and customers across the country and globally and have opened up new growth opportunities for B2B companies and data processing firms. With digital information growing at an exponential rate, there is ever-increasing demand for innovations and new capacity with respect to data analytics, management, and storage.

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The Internet of Things (IoT) is also an ever-increasing market whose growth prospects are immense; data is gathered and used for increased machine-to-machine communication, cloud computing software, and smart technologies. Its applications are vast and include items such as sensors which are used to measure, evaluate, and gather data. Manufacturing, transportation, logistics, and utilities are projected to lead IoT spending but there are a number of consumer applications as well. IoT has the potential to improve the accuracy, speed, and scale of supply chains and open up new opportunities for Business-to-Consumer (B2C) companies. Business-to-Business (B2B) opportunities will likely be driven by activities such as analytics, connectivity, cybersecurity, and cloud and platform services. According to one estimate, the IoT market is projected to grow from $2.99 trillion in 2014 to $8.9 trillion in 2020. vii

There are a number of companies that were founded in Norman that have operations in activities related to information and technical services. The following list is a sample of some local successes and various activities currently operating in the city.

 Agio Technology was founded in Norman and is leading provider of managed IT and cybersecurity services. It offers technology hosting, monitoring, management, helpdesk, disaster prevention and recovery, and cybersecurity management, programs, and consulting. Agio has roughly 200 employees at its three offices in New York, NY; Norman, OK; and Raleigh, NC.

 While Hitachi is a manufacturing company, its applications and inputs are tied to the information and technology services sector. Hitachi Computer Products is a full service custom electronic manufacturing service provider. The Norman facility is involved in both the production and distribution of its products.

 NextThought offers products and services that enhance online education through engaged learning communities. Products and services include building learning platforms, learning design, and video production services. It was founded in 2011 and got its start in NEDC’s business incubator, eTec.

 StoneHouse Marketing Services is a full service marketing company. Its services include print management, packaging and distribution, card affixing, and card personalization. It manufactures, packages, and distributes items such as gift, loyalty, and healthcare laminated cards and key-tags. The company was started in 1995

 Xyant Technology Inc. is an information technology support company that provides on demand technology services support. Its services include technology consulting, global payroll services, innovation and technology platforms, and human capital management and program management.

KEY FINDINGS AND STRATEGIC CONSIDERATIONS  Professional, scientific, and technical services companies, which include many businesses that also have operations related to weather and radar, brought in roughly $345 million to Norman in the form of exported services. Exports within the professional, scientific, and technical services were spread out among a variety of subsectors. (Note that “exports” in the regional context refer to any sales outside the local market – that includes other domestic markets as well as international buyers.) Engineering services accounted for the largest share with $48.9 million in exports, followed by all other professional, scientific, and technical services with $46.6 million.

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 In Norman, information and technology-related sectors nearly doubled in size over the past ten years. For service-providing sectors, Norman has an especially high concentration of jobs in architectural, engineering, and related services and accounting, tax preparation, bookkeeping, and payroll services. For goods-producing jobs, those related to information and technology products are primarily found in computer and peripheral equipment manufacturing.

 Every year, OU produces hundreds of graduates each year in related fields as the increase in demand for these workers has led to an increase in talent production and more degree output. The number of degree completions in computer science programs in 2016 was up 80 percent from 2006. In total, there were nearly 600 completions in related programs over the past ten years. Combined, there were another 688 completions in other related programs, including computer engineering, computer/information technology administration and management, computer systems networking and telecommunications, computer software and media applications, and computer programming.

 The growth in IoT and the increase in big data platforms and applications has led to an increase in demand for data scientists. Nationally, employment increased by nearly 20 percent. Norman has a high concentration of jobs in computer and information research scientists. Although this likely covers some of the economic activity occurring in the weather industry, it is a positive sign of the workforce competencies. The concentration of jobs is roughly double that of the national average.

 Occupations in information and technical services are high paying jobs that provide quality employment for individuals. Median hourly earnings in Norman for computer and information research scientists are estimated to be $44.15 an hour. Nationally, median hourly earnings are $53.75 an hour. Norman’s low cost of living is supportive of a lower wage and is an important site location consideration for companies comparing the labor costs between communities.

 High paying, quality employment opportunities are important to increasing prosperity in the city. Other common occupations within this sector include: accountants and auditors (median hourly earnings, $28.99); software developers, applications ($41.14); software developers, systems software ($32.06); computer user support specialists ($19.75); computer programmers ($32.99); and computer systems analysis ($31.85).

 The U.S. News & World Report recently named Price College as one of the best business schools of 2018, ranking the undergraduate program in the top 50 for public universities, and two specialty programs in the top 25 (International Business at #19 and Center for Entrepreneurship at #22).

 Although Oklahoma’s technical workforce and relatively low utilities cost may make it an attractive place for some data centers in the state, Norman’s location near tornado alley could make it difficult to attract certain data center operations that seek to avoid areas with natural disaster risk. These activities are therefore not included in the related sectors used to define this target. Data centers are capital intensive, often have limited job creation potential, and the competition is immense.

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NORMAN’S NICHE EXAMPLES OF WEATHER & RADAR TECHNOLOGY APPLICATIONS WITHIN THE INFORMATION & TECHNICAL SERVICES SECTOR Information & Technical Services is certainly the target sector with the greatest similarity to and crossover with the Weather & Radar Technology target. The disciplines of meteorology, climatology, and atmospheric science in general are information and technical services at their core. The community’s obvious strengths in these disciplines in terms of educational, research, and economic output provide it with a truly distinct specialization in the “Information” sector that few communities and regions, if any, can emulate. This specialized application of information management and data analysis as it relates to weather forecasting is comparable in principle to the specialization that so many communities and regions seek to develop with regards to healthcare information technology.

While countless areas can effectively compete for healthcare information technology jobs, few can demonstrate a value proposition associated with weather-related information technology akin to Norman. And in a world where the weather impacts so many types of economic activities and investments, there is immense brand and economic value associated with a specialization in such an important and growing field where continued improvements in the accuracy of weather forecasts – a key information service – can improve efficiency and profitability in countless other sectors, from insurance (risk modeling) to tourism (event planning and preparedness) and transportation (fleet coordination and planning) to agriculture (planning for sowing and irrigation). Opportunities likely exist in the growth of private-sector providers of specialized forecasting services to meet the unique needs of these differentiated markets.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

Information Weather & Norman's Aerospace Bioscience Energy & Technical Radar Target Sectors Services Weather and Radar Technologies

DEFINITION: Unlike previously defined target sectors, the Weather and Radar target is not easily defined using traditional industrial classification systems. The application of weather and radar technologies extends itself to a variety of sectors. The use of radar technologies can be applied to various fields of climate, weather, aviation, oil exploration, and other sectors where communication technologies are used. Meteorology and atmospheric sciences applications are being used to provide detailed and accurate forecasting for clients such as airlines, event planners, utility companies, and businesses involved in logistics and just-in-time delivery of goods. Accordingly, its applications to a wider variety of sectors – including other targeted activities in Norman – provide opportunities to strengthen Norman’s niche as a Weather & Radar cluster.

FIGURE 9: NORMAN WEATHER AND RADAR-RELATED SECTOR ACTIVITY, 2006-16 Jobs Location Quotient Change in Jobs (2006-2016) (2016) (2016) # Change, % Change, % Change, % Change, NAICS Business Sector Norman Norman OKC MSA Norman Norman OKC MSA U.S. 541330 Engineering Services 661 397 149.9% -12.5% 5.8% 1.72 0.73 541990 All Other Prof., Scientific, and Tech. Services 251 185 280.0% 70.9% 86.6% 2.66 0.80 541690 Other Scientific & Tech. Consulting Services 32 12 57.9% 470.8% 48.4% 0.34 1.31 541620 Environmental Consulting Services 23 (20) -46.7% 18.1% 12.6% 0.59 0.71 423860 Trans. Equip. (exc. Motor Veh.)...Wholesalers 18 N/A N/A 1.9% -4.0% 1.40 1.66 5179 Other Telecommunications 16 (15) -47.8% -65.8% -52.3% 0.50 1.13 334290 Other Communications Equip. Man. 13 N/A N/A 742.3% -25.6% 1.82 2.37 334514 Totalizing Fluid Meter & Counting Dev. Man. <10 N/A N/A N/A -21.4% 0.54 0.10 3359 Other Electrical Equip. & Component Man. <10 N/A N/A -35.5% -4.9% 0.04 0.07 423690 Other Elec. Parts & Equip...Wholesalers <10 N/A N/A 6.5% -17.7% 0.01 0.82 5174 Satellite Telecommunications <10 N/A N/A 54.0% -50.0% 1.50 1.03 541712 R&D in Phys., Eng., & Life Sci. (exc. Biotech.) <10 N/A N/A -35.3% 11.8% 0.04 0.31 334513 Instrum. & Rel. Prod. Man. for Measuring… <10 N/A N/A -15.1% 0.8% 0.02 0.81 334220 Broad. & Wireless Comms Equip. Man 0 0 N/A N/A -34.5% 0.00 0.04 334511 Search, Det., Nav., Aero...Instrum. Man. 0 0 N/A N/A -23.6% 0.00 0.03 334512 Automatic Environmental Control Man… 0 0 N/A 261.2% -30.2% 0.00 0.62 334515 Instrument Man. for Meas. & Testing Elect… 0 N/A N/A N/A -20.2% 0.00 0.01 334519 Other Meas. & Controlling Device Man. 0 N/A N/A N/A 3.1% 0.00 0.18 336419 Other...Space Veh. Parts & Aux. Equip. Man. 0 0 N/A -100.0% -32.0% 0.00 0.00 Total, Subsector 1,015 520 104.9% 1.0% 2.8% 0.93 0.66 Total, All Jobs 62,725 3,540 6.0% 6.4% 5.0% Source: Economic Modeling Specialists International (EMSI) Location quotients: Location quotients (LQs) measure the relative concentration of regional employment in a given business sector. Specifically, they are calculated by dividing a sector’s share of regional employment by that sector’s share of national employment. A location quotient above 1.0 would indicate that the sector is more heavily concentrated in the region than it is nationally. Color-coding: Employment growth is color- coded such that growing sectors are presented in green text and declining sectors in red text. Those with location quotients greater than or equal to 1.1 are presented in green font. LQs lower than 0.9 are presented in red font and LQs between 0.9 and 1.1 in orange font.

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REGIONAL OVERVIEW AND NATIONAL TRENDS: New types of computer models and technological advancements are enabling the weather community to apply their skills more readily in the private sector. Accurate, current, and customized weather forecasts enable companies to improve efficiency and effectiveness of operations in variety of ways from reduced transportation delays to optimized staffing levels to improved accuracy in estimating wind energy potential. In today’s information age where data is expanding exponentially, meteorology is no exception. Our ability and capacity to extract, manage, and analyze weather-related information is constantly growing, and demand for increasingly customized or specialized weather forecasts is likely to grow as well.

With respect to radar technologies that help collect such information, according to one estimate, the global radar systems and technology market is projected to grow at a compound annual growth rate of more than four percent between 2017 and 2021.viii Radar technologies lend themselves to everything from aerospace and automotive to manufacturing and logistics. For example, the automotive radar market is expected to grow rapidly with technological advancements and innovations due to a growing focus on safety features and growth in autonomous vehicles. Radars detect objects in various safety systems such as pedestrian detection, blind spot detection, and automated emergency braking.

Examples of local employers in the Weather & Radar Technologies target include:

 Atmospheric Technology Services Company (ATSC) offers a reliable, high-quality small business alternative to in-house resources for government operated weather stations, instrumented sites, research support, consulting, technical and business management of government contracts. ATSC economically provides a high level of informed expertise, know-how, contacts, and confidentiality.

 Nanowave designs and manufacturer of advanced microwave, millimeter-wave and electro-optic components and sub-systems. The company specializes in radars for the aerospace industry. It has a research program at OU’s ARRC.

 National Weather Center is located at the University of Oklahoma. It has played a key role in bolstering economic strengths and is an invaluable asset to the activities in Norman related to weather and atmospheric sciences. NWS provides weather, water, and climate data and delivers forecasts and weather warnings.

 The NOAA National Severe Storms Laboratory (NSSL) works to improve the lead time and accuracy of severe weather warnings and forecasts. Basic and applied research focuses on understand sever weather processes, development weather observation technology, and improving forecast tools, with emphasis on weather radar, hydrometeorology, and forecast and warning improvements.

 Weather Decision Technologies, Inc (WDT) provides organizations with weather decision support on a global scale. WDT offers specific expertise with Big Data as it applies to hazardous weather detection and prediction, forecast modeling, decision analytics, GIS, mobile apps and interactive mapping.

 Weathernews is a Japanese forecasting company that opened its U.S. operations center in 2004 in Norman for meteorological research and development in the world. It is located on the OU Research Campus, and as of 2014, its operations provided forecasting data to approximately 2,000 vessels each day.

 The Oklahoma Mesonet is a world-class network of environmental monitoring stations that was designed and implemented by scientists at the University of Oklahoma and Oklahoma State University. There are 121 automated stations across the state. It is operated and maintained by the Oklahoma Climatological Survey.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma

KEY FINDINGS AND STRATEGIC CONSIDERATIONS  The Bureau of Labor Statistics projects that jobs for Atmospheric Scientists, which includes meteorologists, are projected to grow faster than average. Between 2016 and 2026, employment is project to grow by 12 percent. This will partially be driven by technological advancements that will improve the accuracy of forecasts and enable atmospheric scientists to tailor forecasts to specific purposes. As such, demand for atmospheric scientists will likely increase as businesses in private sector seek more specialized weather forecasts and data.

 Over the past ten years, there were an estimated 700 degree completions in the atmospheric sciences and meteorology programs in Norman. Annual openings for related jobs indicate that Norman’s degree completions exceed the estimated number of job openings available locally in related occupations. Given the specialization of the degree, it’s not surprising that many graduates likely move elsewhere for work. However, it also indicates that the city has excess capacity for meteorologists and similar occupations. This highly specialized talent pool is unquestionably among the community’s most marketable advantages to Weather & Radar companies small and large.

 Employment in weather and radar-related sectors are high skilled and high paying occupations. Nationally, atmospheric and space scientists have median hourly earnings of $44.45/hr. For a full-time employee, that equates to an annual income of $92,456. Similarly, geoscientists, except hydrologists and geographers, have median hourly earnings that equate to $90,064 for a full time employee.

 Economic activity in the area of radar technologies requires workers with competencies in computer and electrical engineering. In Norman, the share of electrical engineering is roughly half that of the average community nationwide, however, the number of electrical engineers in Norman has been growing rapidly over the past ten years. Even so, Norman is not currently retaining its electrical and electronics engineering graduates. In 2016, there were an estimated 98 completions but just five openings for related jobs in the Norman area. This is indicates that there is excess workforce capacity; that the employment opportunities are not there locally to retain many graduates. This sentiment was expressed by stakeholders from around the community – Norman is lacking quality job opportunities and losing many graduates.

 Much of the higher education research activities at the University of Oklahoma are in atmospheric science and meteorology. In FY2016, OU’s R&D expenditures in atmospheric sciences were the sixth highest in the country with more than $35 million in expenditures. Atmospheric science R&D expenditures accounted for the second highest field out of all R&D expenditures at OU. In total, 17.2 percent of the university’s total expenditures went to geosciences, atmospheric sciences, and ocean sciences; life sciences led spending and accounted for over half (54 percent) of total R&D expenditures.

 OU’s Advanced Radar Research Center (ARRC) focuses on interdisciplinary education, leveraging a nationally ranked meteorology program and growing engineering departments. The ARRC resides in the state-of-the-art Radar Innovations Laboratory – a 35,000-sqft working laboratory dedicated to innovations in radar technology and science. The RIL is dedicated to advancing OU's radar program. The laboratory includes a large microwave lab with seating for 70 students, 22 staff, and 18 faculty members, a high-bay garage for mobile radar platforms, prototype fabrication facilities, a fully stocked

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machine shop, two precision anechoic chambers, an experimental observation deck, state-of-the-art classroom and seminar space, and an "Ideas Room" for fostering collaboration and innovation. Located just east of the National Weather Center, the RIL has been open since 2015 and has become an integral part of the OU South Research Campus.

 The University of Oklahoma’s School for Electrical and Computer Engineering has been growing significantly due in large part to the advancements made in radar and applied electromagnetics. The cross-disciplinary radar curriculum provides students with a unique and comprehensive coverage of all aspects of radar engineering, from atmospheric science, remote sensing, and propagation to microwave/antenna engineering, signal processing, and systems engineering. Emphasis is placed on providing a hands-on experience for students in designing, analyzing, and prototyping radar components and systems. Additionally, students have the opportunity to analyze real data from several radars here in the Norman area, including the PX-1000, RaXpol, the Digital Array Radar testbed, and the NWRT Phased Array Radar/KOUN Polarimetric Doppler Radar, both operated by the National Severe Storms Laboratory.

 Advancements in the use of drones to improve weather forecasts offer new opportunities for cross- sector applications between the Aerospace and Weather & Radar targets. Interdisciplinary research collaboration is underway between the National Weather Center and the Advanced Radar Research Center of OU and is being funded by the NOAA. Drones have the potential to collect valuable data on wind velocity, air pressure, and humidity in the presence of sever and rapidly changing atmospheric events. Better data would allow researchers to provide more accurate weather forecasts and better anticipate sever weather warnings.

 In June 2017, Japanese-based Weathernews and Canadian company Nanowave agreed to partner on the manufacture of portable weather radars. The new device is called the Enthusiasm for Asia- Genesis Leading Edge (EAGLE) radar. It was developed by Weathernews in collaboration with OU researchers and students at the ARRC. The new partnership with Nanowave, a radio frequency electronics company will create 10 to 15 high-tech engineering jobs. The radars will be made out of Two Partners Place.

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Target Sector Analysis (CONFIDENTIAL FIRST DRAFT) Norman, Oklahoma ENDNOTES

i “2016 Top Markets Report Aircraft Parts.” Department of Commerce. April 2016. Retrieved from https://www.trade.gov/topmarkets/pdf/Aircraft_Parts_Executive_Summary.pdf ii “2017 Global Aerospace and Defense Industry Outlook.” Deloitte. 2017. iii “Economic Impact of the Oil & Gas Industry on Oklahoma.” State Chamber of Oklahoma Research Foundation. September 2016. iv “Short-Term Energy Outlook (STEO).” U.S. Energy Information Administration. January 2018. Retrieved from https://www.eia.gov/outlooks/steo/pdf/steo_full.pdf v “U.S. Wind Industry Third Quarter 2017 Market Report.” American Wind Energy Association. October 25, 2017. vi “Oklahoma State Profile.” American Wind Energy Association. Retrieved from http://awea.files.cms-plus.com/FileDownloads/pdfs/Oklahoma.pdf vii Columbus, Lous. “2017 Roundup of Internet of Things Forecasts.” Forbes. December 10, 2017. viii “Radar Systems and Technology Market Size - Forecast and Assessment Until 2021 by Technavio.” Business Wire. June 23, 2017.

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