Prescott AZ (May 15, 2014) – Students and taxpayers appear to be getting their money’s worth from community colleges in general and Yavapai College in particular, according to the latest data from Economic Modeling Specialists International.
EMSI, a leading provider of economic impact studies and labor market data to educational institutions and others, measures the economic impact of community colleges in two ways: the measurable returns on the cost to students, taxpayers and society as a whole, and the added income in the region due to college operations and student spending. Yavapai College and the American Association of Community Colleges (AACC) regularly conduct such studies to assess the value and benefit that owners (i.e., taxpayers) and students receive for their investment in the College. The latest YC reports are available online at .
From the taxpayer perspective, benefits consist primarily of the taxes that federal, state, and local governments will collect from the added income created. EMSI points out that as community college students earn more, they will make higher tax payments. Employers will also make higher tax payments as they increase their output and purchase more supplies and services. Students are more employable, so the demand for welfare and unemployment benefits reduces. Improved health habits lower the students’ demand for national health care services. Students are also less likely to commit crimes, so the demand for law enforcement services reduces. All of these benefits will generate a present value of $19.2 billion in savings to taxpayers nationally, according to EMSI.
For Yavapai College’s part, Arizona state and local governments allocated $39 millionin support of YC in FY10, the most recent year for which data is available. Significant portions of these costs are recovered by the College and its students in the form of higher tax receipts and a reduced demand for government-support social services, as noted above. At the same time, higher earnings of YC students and associated increases in business and property income expand the tax base in Arizona by about $20.3 million.
In return for their investment, community college students will receive a stream of higher future wages that will continue to grow through their working lives. The average income at the career midpoint of someone with an associate’s degree in Yavapai County is $32,500, 35% more than a student with only a high school diploma. Students enjoy an attractive 17%average real rate of return on their YC educational investment, or $120 per credit hour equivalent, recovering all costs (including tuition, fees, and forgone wages) in 8.5 years.
Yavapai College operations in Yavapai County contribute roughly $40.2 millionin income to the county. EMSI notes that this is a conservative figure adjusted to account for monies that leave the economy or are withdrawn from the economy in support of the College. YC estimates that approximately 12 percentof its students come from outside the region, bringing with them monies that would not have otherwise entered the local economy. The expenditures of YC’s non-local students generate roughly $19.4 millionin total economic impact in Yavapai County.
As Alexandria Wright, director of the Regional Economic Development Center, explains it, “That total consists of direct increased consumption, the ripple effect in the economy that results in increased demand for products and services and the added employment that creates increased household spending in the local area. All told, Yavapai College continues to be a major contributor to Yavapai County’s economy.”