Barton of significant value to region, economic study reveals

Barton Wordmark

July 2, 2014

Story by Brandon Steinert

Barton Community College is one of the area’s largest employers. It’s a progressive, comprehensive community college with offerings ranging from art and traditional associate degree options to more than 25 industry-specific training programs like nursing, natural gas measurement and more. The college’s activities bring in money to the area, stimulate the local economy and it is a driving force behind reducing crime rates and improving quality of life.

While some of these claims are self-evident, it can be difficult to assign any quantitative value to the benefits provided to the local communities. In an effort to provide some context on the college’s value, the Barton Board of Trustees chose to employ the services of Economic Modeling Specialists Inc., a company that specializes in providing such data for colleges.

The EMSI study sources include the 2012-13 academic and financial reports from the college, industry and employment data from the U.S. Bureau of Labor Statistics, earning and demographic data from the U.S. Census Bureau and a variety of studies and surveys relating education to social behavior. The Barton Service Area includes Barton, Rice, Rush, Stafford, Ellsworth, Russell and Pawnee counties.

The study was broken into four primary pieces that look at the college’s value from the perspectives of students, taxpayers and businesses, with the last report examining social benefits.

Board of Trustees Chair Mike Johnson said he was pleased to see the numbers represent what he believed about the college all along.

“The importance of Barton, not only to Barton County, but the entire central Kansas area, cannot be underestimated,” he said. “The institution is an integral part of this area’s educational, recreational and economic development activities.”

The following are highlights from the study results. Complete details can be found at economicstudy.bartonccc.edu.

Taxpayers’ perspective

Taxpayers in Barton County and across the state paid $17.9 million to support Barton’s operations, but the study shows that for every $1, taxpayers see a cumulative return of $2 over the course of students’ working lives. This comes in the form of higher tax receipts and public sector savings.

For example, educated individuals are less likely to have poor health habits, commit crimes or claim welfare or unemployment benefits. The improved lifestyles of these students, according to the study, will result in $3.8 million in savings to government programs over the students’ working careers.

This translates to an annual rate of return on taxpayer investment of 5 percent, which is considered favorable compared to the 1.1 percent discount rate used by the federal government to appraise long term investments.

In addition, almost 90 percent of Barton students remain in Kansas after finishing their educations.

Businesses’ perspective

The benefits to businesses in the Barton service area are numerous, but two stand out.

First, Barton’s training programs sustain a skilled workforce. Students with credentials typically earn more money than those without, which give businesses a larger potential audience with more disposable income. Skilled workers also improve profits at their place of employment via higher productivity. In fiscal year 2012-13, about $82.4 million in added income can be attributed to former Barton students working in the service area, according to the study.

Second, Barton’s payroll and expenses support area businesses. The college employed 789 full- and part-time employees in fiscal year 2012-13. The payroll was $19.4 million, and a majority of that is typically spent in the Barton service area. As a consumer of goods and services, the college spent $20.5 million to support operations throughout the year. This translates to a net impact of $11.7 million in added regional income to the Barton service area due to college payroll and expenses.

According to the study, Barton’s total impact on the service area was $94.1 million in added income during fiscal year 2012-13, which translates to 3.4 percent of the service area’s Gross Regional Product.

Students’ perspective

Of the four beneficiaries examined in the study, students arguably have the most direct and substantial benefit from Barton’s operations. Barton served 16,240 credit students and 332 non-credit students in 2012-13.

The cumulative cost to attend college for Barton students was $10.1 million in tuition, fees and books in 2012-13. The opportunity cost, namely foregone time and earnings they could have made working instead, was estimated to be about $33.6 million. The return on that investment is an impressive 14.3 percent, which comes in the form of higher wages throughout students’ working lives. For every $1 invested, students see a $3.50 return.

Associate’s degree completers earn about $1,311,500 over the course of a working lifetime in the Barton service area, which is $313,900 more than someone with only a high school diploma. At a career midpoint, a Barton graduate would earn about $7,300 more annually than someone without a higher education degree. Those who transfer and continue their educations will continue to see significant benefits at each education level.

Return on investment to society

According to the study, the financial benefits to society as a whole outweigh taxpayer costs. State and local taxpayers supported Barton with $17.9 million. The return on that investment for society is a whopping $387.7 million in benefits, which is $21.50 for every dollar invested as long as the students who attended in 2012-13 remain in the Kansas workforce.

The primary factor contributing to this benefit is the increase in prosperity in Kansas via higher skills and better wages. Over the course of their lives, Barton students from the 2012-13 fiscal year will be responsible for $370.9 million in added income for the state of Kansas.

Another piece of the society puzzle is quality of life. The healthy behavior of a better-educated populace leads to $11.6 million in savings to students and society for medical treatments related to smoking, alcoholism, obesity, drug abuse and mental disorders.

In addition, students have the benefit of earning higher wages and holding better jobs. These factors generate $82,875 in unemployment savings and $2.2 million in law enforcement savings.