Study: Community college is good investment

A study of the socio-economic effect of Flathead Valley Community College showed that students and taxpayers get a big return on investment in education.

College President Jane Karas unveiled the study results at a press conference Monday.

"FVCC graduates contribute nearly $40 million worth of added income per year to the regional economy after leaving FVCC," Karas said.

She said the effect of community-college operations spending and past student contributions amount to almost $50 million. The figure equals 2.6 percent of the regional economy.

To provide perspective, Karas said $50 million would fuel a pickup for every man, woman and child in Montana to drive from Alzada to the Yaak with enough left for 100,000 tourists.

"That's a lot of fuel," Karas said with a laugh.

The study was conducted by CCbenefits of Idaho, a firm specializing in quantifying the economic returns from higher education. It was funded by $4,000 donated to the college.

The study was commissioned for use in strategic planning.

A two-year associates degree increases a student's earnings by more than 35 percent over a person with just a high-school diploma or GED, according to the study.

"Lifetime earnings will increase $3.50 for every dollar invested by a student in tuition, fees, books and foregone earnings," Karas said. "That's a great return on investment."

For every credit taken at Flathead Valley Community College, the study found, a student receives $72 a year in increased income. A load of 30 credits brings an average of $2,000.

The study calculated that a student recovers all costs, including wages foregone while attending college, in 6.8 years.

Along with identifying returns, the study found diminished social costs of crime, health care and unemployment with an educated populace.

Economics faculty member Gregg Davis joined Karas at the press conference. He also serves as director of the Economic Data and Research Center.

Davis said he had long believed that any spending on higher education was an investment.

"It's an obvious win, win, win," he said.

He called it a win for the students, society and the state for tax revenue. Davis said higher education brings wage growth and, most importantly, asset growth.

"Educated people end up with more assets," he said.

Davis said this was important in an age of diminished pensions and retirement plans.

"All of us baby boomers know we will have to rely on our assets more than the previous generation," he said.

Davis added that education has a "huge positive correlation" with small-business creation.

"Also it helps keep the valley one of the most diversified in the state," he said. "Education helps maintain that and expand that."

For the student, he said a similar investment in a 10-year Treasury note brings a return of about 4.5 percent. A similar investment in education ramps their returns between 16 and 25 percent, Davis said.

Davis said that all valley businesses benefit from the college's economic spin-offs.

Karas said examples of how the college delivers for businesses were new programs in electrical, plumbing, nursing, medical lab techs, landscaping, sustainable agriculture and gerontology.

She introduced Chelsea Framer, a 2005 graduate of the college's radiology technician program. Framer works for Kalispell Regional Medical Center where she recently was promoted to a supervisory position.

Framer said she received a great education at the college, including an extensive and varied clinical experience. She was one of first four graduates of the program.

"All of us got jobs locally," she said.

Framer said she continues to learn on the job.

"It's been a great job for me," she said. "I'm excited about the future."

Reporter Candace Chase may be reached at 758-4436 or by e-mail at cchase@dailyinterlake.com.