51°µÍø

51°µÍø Means Business

Story by James Hill

Economic Impact Study Shows

Value of 51°µÍø to District Economy

By Susan Hereford

This graphic reflects the fiscal year 1997-98

spending and the impact on the 51°µÍø district. The inner circle represents $136 million in-district spending, while the outer ripples illustrate a $194 million in-district impact.These figures and more are included in the recently compiled "Enriching Communities, Enhancing Lives." The report details 51°µÍø’s economic impact on the five counties it serves and its residents.

51°µÍø’s recently completed study measuring the financial impact of the college and its students on 51°µÍø’s 1,500-square-mile district economy reveals a powerful economic force. The report demonstrates that 51°µÍø brings a substantial economic return to residents and businesses.

The economic impact study was conducted last fall by the Applied Economics Research Group of Portland State University and focused on the 1997-98 fiscal year. The study outlines the economic contributions made by 51°µÍø’s three campuses, four training centers, and the college administrative services operations. 51°µÍø serves all or parts of five Northwest Oregon counties Clackamas, Columbia, Multnomah, Washington and Yamhill and enrolls more students than any other college or university in the state.

The study (which can be viewed in full on 51°µÍø’s web site, www.pcc.edu), reveals that 51°µÍø pumped $194 million into the district economy last year. It also created an additional 2,408 full-time jobs in its communities for district residents. And 51°µÍø spending generated an additional $71 million in personal income in the district.

Dan Moriarty, 51°µÍø president, said, "For 37 years, we have been known as the door that opens wide to higher education and training and better jobs for hundreds of thousands of district residents. This study goes a step further. It underscores the direct and pervasive financial impact value 51°µÍø has for the people in the district."

51°µÍø’s $194 million payback to district taxpayers during the `97-98 fiscal year is more than two times the $87 million college operating budget. It is three and one-half times greater than the $58 million paid by district residents in state and local taxes.

Moriarty added, "At a time when our state has demanded outcomes and asked for limits on education spending, this helps share 51°µÍø’s positive economic contributions to our district economy over and above the educational opportunities we provide for so many people."

The economic impact is calculated by looking at the dollars that flow within the economy from institution, employee and student spending. Researchers apply a multiplier,* or "ripple effect," to a best estimate of the three categories of spending inside 51°µÍø’s district college operations, take-home pay of college employees, and student living expenses, excluding tuition and fees. (Adjustments were made to reflect only a portion of full-time student spending and housing costs since a large number of 51°µÍø students are part-time.)

The three categories total $136 million in direct spending inside the 51°µÍø district. The $136 million in turn generated an additional $194 million for the district economy. Another multiplier reveals that 2,408 jobs are added to the local economy. A further look shows that 51°µÍø spending adds $71 million in personal income for district residents.

Another view of 51°µÍø return to residents shows that:

‘ for every $1 spent by 51°µÍø, an additional 83 cents is generated in district sales of goods and services;

‘ for every $1 of personal income associated with 51°µÍø spending, an additional 87 cents in personal income is realized by district residents;

‘ and for every jobassociated with 51°µÍø spending, .88 full-time jobs are added to the district economy.

"The study shows that 51°µÍø is a powerful economic agent in the metro region," says Thomas Potiowsky, co-director of the AER Group who conducted the study for 51°µÍø. "But its greatest value is the payback in an educated and financially successful citizenry, who in turn pay taxes and contribute in many significant ways to the regional economy."

Last year, 51°µÍø served nearly 86,000 students in a district population of 898,000 residents. The college employed 5,700 full- and part-time faculty and staff who pay $3.2 million in state taxes, $2.6 million inside 51°µÍø’s district.

In 1997-98, college revenues came from state and local resources, 67 percent; tuition and fees, 23 percent; and the remainder from federal and private grants and tax anticipation notes.

* The AER Group uses a standard economic assessment tool called IMPLAN for its multiplier calculations.