Study data came from a sample of 2,108 purchase orders issued during fiscal year 1985. Data were also gathered on the salaries and towns of residence of 96 prison employees. The analysis considered salary and nonsalary expenses as percentages of the total expenditures and calculated the expenditures occurring within 25 miles of the correctional facility. Fifty percent of the transactions and 65.3 percent of the $11.7 million in annual expenditures went to firms and individuals within 25 miles of Loretto. Salaries and other ongoing expenses within 25 miles amounted to nearly $3.7 million. The prison's continuing expansion indicates future ongoing expenditures of $7.4 million within 25 miles. Most of the nonsalary expenditures go to nonprofit organizations and small businesses. The multiplier effect resulting from the respending of the money by its initial and subsequent recipients increases the economic impact of each dollar by a factor of 2.28 to 3.28, depending on the expenditure category. Review of prior research on prison siting and local impact, data tables, and 23 references.