The University System of Georgia: a worthy investment, Aug. 2008

The University System of Georgia: A Worthy Investment
Adding Value to Georgia
August 2008

To the Members of the General Assembly

Impacting the State's Economy

These are challenging times for all who serve the great state of Georgia. The current economic picture will motivate careful, responsible, and often difficult decisions on the part of many. As representatives of the citizens of Georgia, you have a great responsibility, and as a state agency, it is our responsibility to give you the needed information to aid in your study and decision processes. Therefore, in addition to other documents, reports, and presentations that are made to the General Assembly and its committees, this publication will help you crystallize issues as they relate to the University System of Georgia, its operations, and how the System's 35 colleges and universities affect the lives of Georgians. We will publish approximately 5-6 issues leading up to the legislative session, and we hope they are useful to you in your work. One of the themes you will see throughout these pages and in upcoming issues, is that, through good times and lean times, the University System of Georgia is your partner in a commitment to getting the job done for our 270,000 students, for the business community, for the communities we serve, and for you. We recognize the risks and the responsibilities in managing during these times in ways that protect the academic quality our students expect and deserve, while also maintaining access for all those who qualify to enter. We must, we are, and we will continue to manage the risks inherent in delivering the next educated generation of citizens and leaders and in this we cannot fail. Enjoy the publication and do call if you have any questions. Sincerely,

The University System of Georgia (USG) changes lives for the better through education. The System changes the lives of students through the classroom. The System changes lives on Georgia's farms and in businesses. In short, the University System plays a key role in making things happen in the state. And in so doing, the USG helps Georgia and its citizens become better and stronger contributors to society. Georgia's public colleges and universities add value to this state. There are many levels on which the System adds value to Georgia, its communities, and its citizens. One of the most obvious ways in which value is added is economically the dollars institutions and students spend in local communities; and the greater incomes and buying power USG graduates bring to communities from Dalton to Waycross, from Columbus to Statesboro. The economic value of USG graduates
Last year, more than 45,000 students graduated from the University System of Georgia. These graduates go on to become productive members of the workforce, earning over the course of their careers nearly $1 million more than Georgians with high school diplomas. This means more taxes to support local schools and services, and higher incomes spent in these communities. The economic value of USG institutions The University System's 35 campuses provide thousands of jobs and spur economic development in their local communities. The System attracts the college-educated to Georgia to take jobs as faculty, and staff, teaching and supporting the University System's 270,000 college students.

Erroll B. Davis Jr. Chancellor

University System institutions contribute numerous amenities and services to their communities from public lectures to dramas, concerts, sports, continuing-education classes, libraries, wellness programs and small business development centers.

"GCSU (Georgia College & State University) gives us tons of business. When school comes back in August, we'll be slammed," Michael Packard said from behind the counter at Blackbird Coffee on Hancock Street (Milledgeville).... "For our business, it seems like there's a lot of students that come here to study and hang out. It's a very diverse crowd. They meet with their professors, or coworkers, or just come to rest and study." [Union Recorder, July 16, 2008]

Amanda Clouse Photography

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Adding Value to Georgia

2

ICAPP Economic Impact Study The System's 35 institutions packed a combined economic impact on the state totaling $11 billion during Fiscal Year (FY) 2007. This is according to a study commissioned by the Intellectual Capital Partnership Program (ICAPP), an initiative of the Board of Regents' Office of Economic Development. The Selig Center for Economic Growth in the University of Georgia's Terry College of Business analyzed data collected between July 1, 2006, and June 30, 2007, to calculate the University System's FY2007 economic impact.

Adding Value to Athens: The University System's largest institution the University of Georgia (UGA) with 33,405 students has the single greatest economic impact: close to $2.1 billion on the Athens-area economy, or 19 percent of the System's total statewide economic impact.
Adding Value to Augusta: Together, the Medical College of Georgia and Augusta State University have a $1.1 billion economic impact on the Augusta economy and produce 11,000 jobs. And that does not even include spending by the hospital and clinics operated by MCG Health, Inc., which became a non-profit corporation in 2000.

A similar study conducted on FY2004 data placed the University System's economic impact at $9.7 billion. The first such study calculated the USG's impact at $7.7 billion in FY1999. It is clear that the USG's economic impact and the added economic value of the System to Georgia in growing significantly, and thus helping Georgia communities grow as well.

Another way in which the USG adds value is by providing jobs

throughout the state. The ICAPP study

The Georgia State cam-

determined that the USG is responsible for 106,267 full- and part-time jobs

pus is in the middle of 2.6 percent of all the jobs in the state

a $1 billion expansion, or about one job in 39.

including a $250 million complex for its science programs and the campus' first housing for

Approximately 42 percent of these positions are on-campus jobs and 58 percent are positions in the private or public sectors that exist because of the presence in the community of USG institutions.

fraternities and sororities. Last fall, the campus opened a 2,000-

For each job created on a campus, there are 1.4 jobs that exist off-campus because of spending related to the college or university.

bed dorm complex, and a 300-bed residence hall reserved for freshmen is under construction. That physical growth has helped spur

$7.3 billion (66 percent) of the $11 billion in total economic impact was due to initial spending by USG institutions for salaries and fringe benefits, operating supplies and expenses, and other budgeted expenditures, as well as spending by the students who attended the institutions in FY2007.

a revitalization of Atlanta's downtown business district ... [USA

Re-spending the multiplier effect of those dollars as they are spent again in the region accounted for another $3.8 billion (34 percent).

And as the

What it boils down to is this: Metro Albany

Medical College pur-

is fortunate to have two quality institutions

sues expan-

of higher learning that are creating this

sion into other areas of the

kind of economic impact. Without them,

state to meet a the metro area and region would be poorer

growing need

for more phy- in many ways, including both intellectu-

sicians, its economic

ally and financially. [Albany Herald, June 11,

impact on

2008]

Georgia will

increase.

According to a study conducted by Tripp Umbach, MCG's expan-

sion would generate more than $1.6 billion a year and support

more than 10,000 new jobs producing $2.54 in state revenue for

every $1 invested.

Adding Value to Savannah: In the Savannah area, Armstrong Atlantic State University and Savannah State University pumped $317 million into the economy and the two institutions produce more than 3,100 jobs.

Adding Value to Albany: Darton College and Albany State University help create a vibrant economy in Albany. Together they account for a $243 million economic impact and 3,000 jobs.

Adding Value to Columbus: Columbus State University impacted the local and surrounding communities by contributing $212 million to the economy and employing 2,400.

Adding Value to Middle Georgia: Middle Georgia institutions Macon State College, Fort Valley State University, and Middle Georgia College accounted for $342 million in total impact and 3,800 jobs.

Today, July 1, 2008]

"Students are the champions" of spending at Gainesville State, Humphreys

Adding Value to Metro Atlanta: On average, for every dollar of initial spending in a community by a University System institution, an additional 52 cents was generated for the local economy hosting a college or university. Seven institutions in the metro Atlanta area Georgia Institute of Technology, Georgia State University, Clayton State University, Kennesaw State University, Southern Polytechnic State University, Atlanta Metropolitan College and Georgia Perimeter College accounted for almost $4.5 billion of the University System's $11 billion total, and 40,700 jobs.

said. "They're the ones really driving the economic impact of the institution." At Gainesville State last year, personnel accounted for $42 million in spending, while students accounted for about $90 million. He said this is not always the case at every school, however. One of the most important ways an institution affects its community is by creating jobs, both on and off campus, Humphreys said. "A lot of offcampus jobs owe their existence to the presence of Gainesville State, even though many of the people who hold those jobs don't even realize it," he said. There are two people working off campus for every one person working on campus in a job associated with Gainesville State. [Gainesville Times, June 6, 2008]

The University System of Georgia: A Worthy Investment August 2008