Transcript remi - Center for Economic Forecasting and Analysis

Economic Impact of Centers and
Institutes in Florida’s Public Universities
Tim Lynch, Ph.D., Director
Julie Harrington, Ph.D., Asst. Dir.
Center for Economic Forecasting and
Analysis
Florida State University
www.cefa.fsu.edu
September 24, 2002
Old Economy
People
Productivity
Low cost production
Strong economy
Capital
Entrepreneurs
Profits
Goods
Services
New Economy
People
Capital
Higher productivity
Higher wages
Higher quality of life
More resilient economy
Higher efficiency
Higher wealth
Higher profits
Entrepreneurs
Goods
Services
Overview of Florida’s Centers
and Institutes (C/Is)
For fiscal year 2001, there were 512 C/Is located at 10 Universities in
Florida (FSU, FAMU, UF, FIU, UCF, FGCU, FAU, UNF, USF and
UWF). The C/Is are categorized by type center (1,2 or 3) based on
their budgetary support and overall mission.
Our project’s objective is to respond to an overall legislative charge to
evaluate the return on the state’s investment in centers and institutes in
Florida’s public universities. The project, still in development, has
conducted a comprehensive survey (52.2% response rate) as a means
to quantify intangible benefits of C/Is, has completed statistical and
economic analyses,and is conducting on-site interviews of C/Is. The
economic analysis of C/Is was performed using REMI.
Percentage of C/I Activities
Percentage of C&I Activities
2000-01
Public
Service/Other
20%
Teaching/
Training
30%
Basic &
Applied
Research
50%
Areas of Principle Concern Addressed
by C&I Activities
1. Maternal/Child Health and Child Development
Issues
2. Economy/Business/Transportation
3. Elderly/Aging
4. Environmental/Ecology/Energy
5. Governance/Law/Race
6. Healthcare/Medicine
7. Schools/Education
8. Community/State/National/International Outreach
C/I Model Framework
(Basic Assumptions)
As part of our modeling strategy, we examined two scenarios, the revenue and
expenditure approach regarding the impact of C/Is on the Florida economy.
The base model assumed a constant rate of growth for the economy.
The revenue approach model used: data for fiscal year 2001 for type 1,2,3
Total; SUS state investment = $88.8 million; The state investment leverages an
additional $212.71 million in contracts and grants, fees (auxillary) and private
funding, yielding a total of $301.5 million. The expenditure approach provided
a greater level of detail, where actual fiscal year 2001 C/I expenditures (by
category; salaries, expenses, etc.) were entered into the model.
We assumed that, in the absence of SUS C/Is, the SUS investment ($88.8
million) will be reallocated to other higher educational activities.
REMI results will be expressed in terms of impacts on GRP, employment,
personal (disposable) income and state tax revenues.
Percent of University Expenditures for
SUS C/I’s for Fiscal Year 2001
Salaries
4.6%
12.0%
Special Cat.
0.2%
40.5%
Electrical
Operating
Expenses
27.9%
Other
6.9%
1.0%
7.0%
Graduate (Sal)
House Staff (Sal)
C/I Models For REMI Workshop
Revenue vs. Expenditure Models
Four Expenditure Scenarios
Using C/I Employment Numbers
Using C/I Salary Data
Using C/I Employment Numbers and Detailed
Sector Data
Using C/I Employment Numbers and Final Sales
REMI Tax Results vs. CEFA Tax Results
REMI Inputs For Revenue and
Expenditure Models
Policy Variable Categories
Detail Selection
Output BlockDetailed Government SpendingState &
Local
Higher Education
Output BlockIndustry DemandFinal and Intermediate
Demand
Computer & Data Processing
Misc. Business Services
Electric Utilities
Misc. Professional Services
Computer & Office Equipment
Labor and Capital Demand Block Employment
Education
Medical
Misc. Business Services
Misc. Professional Services
REMI Expenditure Approach Policy
Variable and Value Detailed Breakout
University C/I's Expenditure Categories
Sector
Special Category, computer and data processing output
component
block; Demand
Libraries component of special category
output block; Demand
Libraries component of special category
output block; Demand
Libraries component of special category
output block; Demand
Libraries component of special category
output block; Demand
Libraries component of special category
output block; Demand
Libraries component of special category
output block; Demand
Libraries component of special category
output block; Demand
Electrical component
output block; Demand
Operating Expenses
output block; Demand
Expenses category
output block; Demand
Expenses category
output block; Demand
Expenses category
output block; Demand
Expenses category
output block; Demand
Expenses category
output block; Demand
Expenses category
output block; Demand
Other category; subcontracts primarily
output block; Demand
Other category; subcontracts primarily
output block; Demand
Other category; subcontracts primarily
output block; Demand
Salaries category
Labor and Capital Demand;Employment
Salaries category
Labor and Capital Demand;Employment
Salaries category
Labor and Capital Demand;Employment
Salaries category
Labor and Capital Demand;Employment
Detail
computer and data processing
misc. business services
real estate
credit and finance
communication
other transportation
printing
electrical equipment
electric utilities
office & computing equipment
computer and data processing
repairs to buildings
research and testing services
local & interurban transit
air transportation
misc. business services
legal services
A&E services
research and testing services
Education
Medical
Misc. Bus
Misc. Prof
2001 Data
-12
-0.5
-0.5
-0.2
-0.2
-0.01
-0.2
-0.1
-0.35
-15.152
-20.87
-6.96
-6.96
-3.48
-3.48
-27.83
-10.5
-10.5
-10.5
-1.156
-0.001
-0.166
-0.09
Revenue and Expenditure Approach Results
Revenue Approach
Real Discount Rate
Discount rate and factor
3.0%
Discounted GRP
$
Discounted Real Disposable Income
$
Employment (Thousands)
Dollars
256,344,236
183,850,325
5,832
Expenditure Approach Using Broader Sector Categories
and Salary Data (Salary Model)
Real Discount Rate
Discount rate and factor
3.0%
Discounted GRP
$
Discounted Real Disposable Income
$
Employment (Thousands)
Dollars
269,416,041
243,924,273
6,955
Revenue and Expenditure Approach
Results, Continued
Expenditure Approach Using Broader Sector Categories
and Employment Numbers (Employment Model)
Real Discount Rate
Discount rate and factor
3.0%
Discounted GRP
$
Discounted Real Disposable Income
$
Employment (Thousands)
Dollars
234,712,143
241,515,218
6,953
Expenditure Approach Using Detailed Sector Categories
(Employment and Detailed Model)
Real Discount Rate
Discount rate and factor
3.0%
Discounted GRP
$
Discounted Real Disposable Income
$
Employment (Thousands)
Dollars
275,449,029
278,050,728
7,972
Revenue and Expenditure Approach
Results, Continued
Expenditure Approach Using Broader Sector Categories
and Employment Numbers (Final Sales Model)
Real Discount Rate
Discount rate and factor
3.0%
Discounted GRP
$
Discounted Real Disposable Income
$
Employment (Thousands)
Dollars
273,982,255
245,303,832
6,757
Centers and Institutes Economic and Employment
Results for Revenue and Expenditure (Salary
Model) Approaches For FY 2001
Gross Regional Product
Employment
$275,000,000
$270,000,000
$265,000,000
$260,000,000
Gross Regional Product
Employment
$255,000,000
$250,000,000
$245,000,000
Revenue Approach
Expenditure Approach
7,200
7,000
6,800
6,600
6,400
6,200
6,000
5,800
5,600
5,400
5,200
Tax Revenues for Direct and Indirect Economic
Activity for C/Is in Florida, 2001
STATE AND LOCAL TAX RECEIPTS
DOR ADMINISTERED TAXES/ DOR ACCOUNTS
OFFICE OF RESEARCH & ANALYSIS
Fiscal Year 2001 Statistics
DOR State Tax Receipts
REMI # OF EMPLOYEES 2001
9,085,236
TAX COLLECTION
LEVEL
TAX COLLECTION CATEGORY
Sales & Use Tax (chapter 212)
Sales at 6 percent
Use at 6 percent
Corporate Taxes (chapter 220 & 221)
Documentary Stamp Tax (chapter 201)
Insurance Premium Tax (chapter 624)
Intangibles Taxes (chapter 199)
Annual Tax (B & D) Beverage ?
Nonrecurring Tax (C)
Government Leasehold Tax
Estate Tax (chapter 198)
Severance Taxes (chapter 211)
Part 1 - Oil & Gas
Part 2 - Solid Minerals
Fuel Tax (chapter 206)
Part 1 - Motor Fuel
Part 2 - Special Fuel
Diesel & Misc. Special Fuel
Lp Gas (Altern. Fuel Decal)
Part 3 - Aviation Fuel
Fuel Tax (chapter 336) SCETS
Gross Receipts Utility Tax (chapter 203)
Pollutants Taxes (chapter 206 pt. IV)
Coastal Protection Tax
Water Quality Tax
Inland Protection Tax
Hazardous Waste
Dry Cleaning Tax (chapter 376)
Rental Car Surcharge (section 212.0606)
Waste Tire Fee (chapter 403)
Lead Acid Battery Fee (chapter 403)
Audit & Warrant Collections
Misc. State Taxes and Fees
Total DOR State Taxes
$
$
$
$
$
$
$
$
$
$
14,881,006,072
852,726,382
1,591,873,507
1,305,200,810
387,855,367
717,300,000
498,923,872
233,469,995
907,385
707,564,664
$
$
8,449,519
40,864,529
$
1,019,975,798
$
$
$
$
$
186,908,486
6,253
65,112,188
459,684,720
651,141,531
$
$
$
$
$
$
$
$
$
$
$
7,590,854
20,188,109
206,755,525
20,692,847
9,902,297
145,891,717
18,887,665
9,240,112
214,293,026
2,086,860
24,264,500,090
TAX YIELD PER EMPLOYEE
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
$
1,637.93
93.86
175.22
143.66
42.69
78.95
54.92
25.70
0.10
77.88
0.93
4.50
112.27
20.57
0.00
7.17
50.60
71.67
0.84
2.22
22.76
2.28
1.09
16.06
2.08
1.02
23.59
0.23
2,670.76
TAX YIELD PER /
MILLION $ GRP
$31.19
$1.79
$3.34
$2.74
$0.81
$1.50
$1.05
$0.49
$0.00
$1.48
$0.00
$0.02
$0.09
$0.00
$2.14
$0.00
$0.39
$0.00
$0.14
$0.96
$1.36
$0.00
$0.02
$0.04
$0.43
$0.04
$0.02
$0.31
$0.04
$0.02
$0.45
$0.00
$50.85
TAXES GENERATED BY
SUS CENTERS &
INSTITUTES FROM
2001 CONTRACTS &
GRANTS
$
8,401,978
$
481,459
$
898,789
$
736,931
$
218,987
$
404,995
$
281,698
$
131,820
$
512
$
399,499
$
$
4,771
$
23,073
$
$
575,889
$
$
105,531
$
4
$
36,763
$
259,543
$
367,642
$
$
4,286
$
11,398
$
116,736
$
11,683
$
5,591
$
82,372
$
10,664
$
5,217
$
120,992
$
1,178
$
13,700,001
Tax Revenues for Direct and Indirect Economic
Activity for C/Is in Florida, 2001, Continued.
OFFICE OF RESEARCH & ANALYSIS
DOR State Tax Receipts
-----------------------------------------------------------------------
41,795
TAX COLLECTION
LEVEL
TAX COLLECTION CATEGORY
Sales & Use Tax (chapter 212)
DOR LOCAL TAX RECEIPTS
Sales Taxes/Surtaxes
Infrastructure Surtax
Charter County Transit Surtax
Education Surtax
Indigent Care Surtax
Tourist Development Tax
Dade Documentary Stamp Tax
Motor & Special Fuel Taxes
County Voted at 1 cent
County & City Nonvoted @ 1-6 cents
Additional Local Option
Miscellaneous Local Taxes and Fees
TAX YIELD PER EMPLOYEE
TAX YIELD PER /
MILLION $ GRP
TAXES GENERATED BY
SUS CENTERS &
INSTITUTES FROM
2001 CONTRACTS &
GRANTS
Fiscal Year
$
$
$
$
$
$
$
$
$
$
$
607,749,637
51,563,928
51,922,843
167,125,658
3,711,306
12,099,362
1,738,400,000
62,689,700
533,159,834
141,652,109
-
$
$
$
$
$
$
$
$
$
$
$
66.89
5.68
5.72
18.40
0.41
1.33
191.34
6.90
58.68
15.59
-
$1.27
$0.11
$0.11
$0.35
$0.01
$0.03
$3.64
$0.13
$1.12
$0.30
$0.00
$
$
$
$
$
$
$
$
$
$
$
343,142
29,114
29,316
94,361
2,095
6,831
981,520
35,395
301,028
79,978
-
Total DOR Local Taxes
$
3,370,074,377
$
370.94
$7.06
$
1,902,781
Total DOR State and Local Taxes
OTHER (Florida Tax Handbook 2002)
Beverage Licence and Taxes
Cigarette and Tobacco Product Tax
Motor Veh & Mobile Home Ann Reg
All others ***************** ESTIMATE
$
27,634,574,467
$
3,041.70
$57.91
$
$
$
$
$
575,300,000
442,800,000
535,900,000
2,980,000,000
4,534,000,000
$
$
$
$
$
63.32
48.74
58.99
328.00
499.05
$1.21
$0.93
$1.12
$6.25
$9.50
$
$
$
$
$
$
324,821
250,010
302,575
1,682,540
2,559,946
SUB TOTAL
5,119,892
TOTALS ALL CATEGORIES
$
32,168,574,467
NUMBER OF THOUSANDS 2002$ IMPACT
REMI GRP 2001$
$
269,416
477,171,160,920
$
3,540.75
$67.42
$
18,162,728
Comparison of Tax Results Using
Expenditure Salary Model
REMI Results
•For 2001, tax revenues total $32 million
•For Years 2001-2035, tax revenues total $320 million
(2001 dollars)
CEFA Results
•For 2001, tax revenues total $18 million
(excluding property taxes, among others)
Results of Economic Analysis for
University Centers and Institutes For
The State of Florida
For the State of Florida, using the revenue approach, if all centers and institutes
were removed from the university system, and the state investment ($88.8
million) was reallocated to higher education spending, there would be a net loss
of $256 million in GRP, $184 million in personal income, and 5,832 jobs.
For the State of Florida, using the expenditure approach (salary model), if all
centers and institutes were removed from the university system, and the state
investment ($88.8 million) was reallocated to higher education, there would be a
net loss of $269 million in GRP, $244 million in personal income, and 6,955 jobs.
The difference between the two models (comparing expenditure to revenue
model) is $13 million GRP, $60 in personal income and 1,123 jobs.