Review Finds USDA Underestimates Cost of Moving Researchers

Economists with the Agriculture and Applied Economics Association (AAEA) have reviewed the cost analysis released by USDA leadership on June 13 to justify relocation two USDA research agencies to Kansas City. The USDA report reports there will be a net savings to U.S. taxpayers.

However, a review by three AAEA member economists finds that USDA leadership failed to follow federal guidelines for the benefit cost analysis. The economists’ review finds a major underestimate of true costs. In fact, they say, the move to Kansas City will cost taxpayers between $83 million and $182 million, rather than saving them the $300 million claimed.

The USDA analysis claimed net savings from the cost of real estate and the cost of staffing. The AAEA economists focused on corrections to the cost of real estate and the value of public benefits lost from untimely attrition of the workforce during a high workload season.

The AAEA researchers included two former administrators of the Economic Research Service, one of the two agencies slated to move. The other agency is the National Institute of Food and Agriculture.