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PCC Means Business

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Economic Impact Study Shows

Value of PCC to District Economy

By Susan Hereford

This graphic reflects the fiscal year 1997-98

spending and the impact on the PCC 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 PCC’s economic impact on the five counties it serves and its residents.

Portland Community College’s recently completed study measuring the financial impact of the college and its students on PCC’s 1,500-square-mile district economy reveals a powerful economic force. The report demonstrates that PCC 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 PCC’s three campuses, four training centers, and the college administrative services operations. PCC 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 PCC’s web site, www.pcc.edu), reveals that Portland Community College 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 PCC spending generated an additional $71 million in personal income in the district.

Dan Moriarty, Portland Community College 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 PCC has for the people in the district."

PCC’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 PCC’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 PCC’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 PCC students are part-time.)

The three categories total $136 million in direct spending inside the PCC 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 PCC spending adds $71 million in personal income for district residents.

Another view of PCC return to residents shows that:

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

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

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

"The study shows that Portland Community College is a powerful economic agent in the metro region," says Thomas Potiowsky, co-director of the AER Group who conducted the study for PCC. "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, Portland Community College 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 PCC’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.

About James Hill

James G. Hill, an award-winning journalist and public relations writer, has been the Communications Specialist for the Office of Public Affairs at Portland Community College since November of 1999. A graduate of Portland State University, J... more »

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