COEUR d'ALENE - What if North Idaho College didn't exist?
A recent economic impact study shows there would be a $164.6 million hole in the region's economy.
Conducted by EMSI (Economic Modeling Specialists, Intl.), the results of the study were presented to trustees Wednesday during their regular monthly meeting.
"This is a really important study to undertake because, especially in our current economy, education is perceived as a budget item, a cost item, and not an investment," said Gabriel Rench, a representative of the Moscow-based EMSI.
EMSI analyzed NIC's investment value to students and taxpayers and also reviewed the college's effect on the economic growth of Idaho's five northern regions.
"The real impact that you're having is that you're producing an educated workforce that goes out and is more productive than it otherwise would be," said Tim Nadreau, an EMSI research economist.
The study was requested by NIC's administration at a cost of $8,500, said Mark Browning, the college's vice president of community relations and marketing. It will be used to illustrate NIC's value to community members, legislators and policy makers.
Nadreau said EMSI is not an advocacy group, that it has published results that are "below threshold."
"If there is a college that is a bad investment, we're not shy about saying so," he said. "We come at this almost like a financial auditor would come at your books. We're doing an economic audit of your operations."
For students, the annual cost of NIC is $95.4 million. That includes books, tuition and other outlays, and considers the dollars students are giving up to sit in a classroom rather than out making money. The benefit for students is $341.4 million, a cost/benefit ratio of 3.6 for a year or learning, reflecting a 16.1 percent annual rate of return on investment.
For students, the 3.6 ratio means that for every dollar a student spends on education at NIC, that student gets back $3.60.
"That 16.1 percent is a better return than you're going to get on most of your private investments. It's very rare that you're going to get something that high, so the students are really making a killer deal here," Nadreau said.
For taxpayers, EMSI determined NIC costs $30.4 million per year to operate and returns $44.3 million to the economy, reflecting a 1.5 benefit/cost ratio, a 5.8 percent return on investment.
The return for taxpayers comes from a broadening of the tax base, Nadreau explained, because more educated earners are higher paid and they pay more taxes.
There is also a social savings, he said. Higher educated individuals are less likely to engage in crime and other behaviors with health and legal consequences that translate into higher costs for taxpayers.
It's rare for public investments to have a return this high, Nadreau said.
"Essentially, we're saying that for every dollar taken out of the public treasuries (for NIC), we're putting $1.50 back in. That's 50 cents more than the state had to invest in infrastructure. That's 50 cents on the dollar more that they have to invest in other types of public endeavors," he said.
From NIC's operational expenses, the local economy garners $32.9 million annually.
Nadreau said that number reflects jobs that are out there because of NIC.
Students who relocate to Idaho's five northern counties to attend NIC pump $19.2 million into the region's economy. They do this by paying rent, buying food and paying for entertainment, he said.
The community college's total impact on North Idaho is $164.6 million. It represents 2.7 percent of the total regional economy.
"With colleges that are below threshold, these meetings are not very fun. When a college can come in and shine the way NIC has done here, it's a big win for you guys and it's nice to see that my home state is doing its job well and not misappropriating the funds that it receives. It's good to see competent people in Idaho," Nadreau said.