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Report: ASU has impact of $506 million
It looks at salaries, spending, more
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Published: June 30, 2008
BOONE
There's a simple observation people in this university town often make when school is out at Appalachian State University.
"It's easier to park," Mac Forehand, the director of the Boone Convention & Visitors Bureau, said last week.
The visible drop in traffic in Boone is just one anecdotal piece of evidence for how much the university affects the area.
Although people have long recognized the influence of ASU, three economics professors there have created an economic model to calculate just how much economic effect the university has on Watauga, Ashe, Avery, Caldwell and Wilkes counties.
They found that spending by ASU employees, students and visitors had a $506 million economic impact on the region for fiscal 2006-2007.
"We took a pretty conservative approach to what we included," said Mike McKee, who conducted the study with colleagues Todd Cherry and Stephen Millsaps.
University spending, including salaries and wages, operation and maintenance costs, capital spending and spending for special programs and events, was $258 million. Added to that was the $97 million that students spent on off-campus housing, food, entertainment and recreation. Visitors attending football games and other sporting events added nearly $7.8 million.
Not every dollar of that $362 million is spent locally -- for instance, the financial numbers include money used for supplies bought off the mountain -- but a big chunk of the money is spent in the area.
"There's no way to capture every dollar that is spent, but we did try to include major expenditures in categories such as real estate, wholesale and retail trade; construction and repair; recreation; and transportation, communications and utilities," Cherry said. "We wanted to determine how much regional economic activity is due to the university's presence."
The study also calculated how some of those dollars are recirculated in the local economy. For instance, people spend salaries in the local economy, generating indirect spending tied to the university. Taking the $362 million in direct spending and adding an estimate for the indirect spending yields that report's $506 million economic impact.
The numbers are in line with what the professors expected from similar communities, McKee said.
"We knew it was a very big shot for the local economy," he said.
To put the numbers in perspective, consider that tourists spent $179 million in Watauga County in 2006, according to the latest figures available from the N.C. Department of Commerce.
Tourism and ASU are the county's two biggest drivers of the economy.
"We'd hate to lose either one; either one would be devastating," Forehand said.
He noted how tourism and the university are often complementary. For instance, July is a less busy time at ASU, but it's the busiest month for tourists as people look for cooler weather.
For all the huge economic numbers, McKee noted that the mission of ASU is to educate people, conduct research and advance knowledge.
"The fact it does (contribute so much to the economy) is an additional benefit to the region and the state," he said.
The professors compiled the report for the Center for Economic Research and Policy Analysis in ASU's Walker College of Business. ASU anticipates having about 16,400 students this fall.
■ Monte Mitchell can be reached in Wilkesboro at 336-667-5691 or at mmitchell@wsjournal.com.
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