Montana University System touts economic benefits to State of Montana

DILLON — A new study commissioned by the Montana University System says the state’s colleges and universities are “ economic engines” that contribute more than $780 million a year to the state’s economy.

By Perry Backus of The Montana Standard

But, according to University of Montana–Western Chancellor Stephen Hulbert, the system’s smaller schools’ engines could eventually be running on empty if the state continues its course of reductions in funding.

The study, called “ Partners in Building a Stronger Montana Economy,” outlines the economic impacts each unit contributes into its own local economy.

For instance, Western’s students, faculty and staff contribute an esti mated $12,891,553 in the local econ omy through payments for housing, transportation, retail trades and ser vices. The study estimated that an additional $4.5 million finds its way into the economy through non-resi dent students, grants, and expendi tures from out-of-state visitors. Those totals don’t include the money the university itself spends on supplies, food and services.

“ Everyone perceives there is a value to having a college or univer sity located in a community,” said Hulbert. “ Few really know the extent of that impact.”

The study shows Western is among the top tier of employers in Beaverhead County. The school is one of the essential legs to the economic well-being of Dillon and the surrounding area. The others include agriculture, Barretts Minerals, federal land management agencies and Barrett Hospital and HealthCare.

At the same time that Western is playing that role in the local economy, it’s also having to address cuts in state funding.

Since 1992, appropriations for Western have increased only $100,000, said Hulbert. The impacts from constant cuts in state funding are starting to be felt by students and the institution, said Hulbert.

Students have been impacted through significant increases in tuition, which cause them to have to work longer hours, find additional jobs and carry increasing loads of debt.

At the same time, college campuses in other states are stepping up recruitment efforts that include attractive financial packages that make it increasingly difficult for Montana’s schools to compete, said Hulbert.

In turn, the state loses both the money it costs to put that student through school and some of its best potential for future leaders and entrepreneurs.

“ It’s been my experience that students often form a relationship to the place where they attend college,” he said. “ There are many living in Dillon who came here, dis covered they enjoyed this area and decided to stay.”

“ When a student leaves the state, there’s a good chance he or she may never come back,” said Hulbert.

Western has been forced to cut budgets to match lowered state funding levels. As a result, it has been forced to leave adminis trative positions unfilled, eliminate jobs at its physical plant, and look for other cost saving measures.

“ In the end, there’s only so many things you can do,” said Hulbert. “ We have an extremely talented faculty and staff that works incredibly hard. We continue to have strong academic programs and we’re adding new majors every year.”

Western has also done well in finding grants, foundation support and donors will ing to help. Those have been used to supple ment student tuition and state appropria tions.

“ I think we’ve done some amazing things,” Hulbert said.

Western is facing a serious challenge as the state considers how higher education should be funded. Hulbert believes that most Montanans don’t always look beyond the campuses in Missoula and Bozeman when they consider the fate of higher edu cation in the state.

“ The risk to Western and the other smaller universities, Montana Tech, MSUNorthern and even MSU-Billings, is very real but, in my opinion, it also reflects the growing disconnect between rural and more urban Montana,” Hulbert said. “ That discon nect is seen in public higher education, in the K through 12 sector and in the economic vitality of the general business community in rural Montana.”

When times are tight, people look to high er education as a way to overcome a lagging economy.

“ Many states have looked to higher education as a major resource during financial downturns,” said Hulbert. “ When times are hard, people go back to school to finish a degree or to get the training they need to start a new career.”

Universities are also the place where research projects uncover new ways to spur economic development and faculty mem bers serve as consultants to share their expertise with the community, Hulbert said.

“ There’s no question that colleges and universities play an important role in the economic health of local communities and the overall state,” he said.

— Perry Backus may be reached via e-mail at perrybackus(at)(at)yahoo.com.

http://www.mtstandard.com/dillon/dillon1.html

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Montana Tech’s economic contribution at $49 million

By Barbara LaBoe of The Montana Standard

Montana Tech has a large financial impact on Butte, ranging between $36.5 million to $49 million annually — depending on which survey is used.

The university system survey (see related story under Dillon News) found that the annual spending of Tech faculty, staff and students is $24.8 million, not counting money the institution itself spends. In addition, the economic impact of out-of-state students, expenditures and visi tors is $11.5 million, for a grand total of $36.5 million.

Those figures are similar to those in a 2000 study Tech did on its economic impact to the community. That survey, completed by Ray Rogers, Tech’s director of college relations and marketing, found that overall the annual impact of Tech is $49 million to the local economy.

The Tech study numbers are higher because it also took into account money the school spends on items such as utilities and office purchases as well as the indirect impact of Tech money generating other rev enue in the area.

The direct impact — spending by staff, students, faculty and the university — aver aged $29 million a year. The indirect impact of the Tech spending — assuming each dol lar spent generates 65 cents of additional revenue — was $19 million, for a total of almost $49 million dollars.

Indirect costs count how money works its way through a local economy more than once. For example, when a contractor is paid, he in turn pays his workers their wages with that money and they in turn use that same money to purchase goods and ser vices. Rogers said the 65 cents formula he used was rather conservative, with some studies assuming $1 generated $3 in addi tional revenue.

The 2000 survey also found that Tech’s presence in Butte generates 490 jobs annu ally — based on a formula that every $1 mil lion spent generates 10 jobs. Those jobs, in turn, generate an estimated $10 million annually.

Rogers said people in Butte were sur prised at the extent of Tech’s impact when the 2000 survey came out, adding it’s still one of the most requested publications from the college.

If the additional formulas Tech used are removed, however, the base numbers of both surveys are similar, Rogers said.

“ It’s important as the Montana University System that we demonstrate to the state of Montana the importance of the university system as it relates to economic development,” he said. “ It’s a substantial impact and contributes to the well-being of our entire state.”

— Barbara LaBoe, The Montana Standard

http://www.mtstandard.com/newslocal/lnews3.html