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Archive for Sunday, September 20, 1998

KU MAKES HEFTY CONTRIBUTION TO CITY

September 20, 1998

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Every year Kansas University faculty, staff, students and researchers bring millions of dollars to Lawrence.

Measuring Kansas University's economic impact on the community of Lawrence is far from an exact science.

``The university generates revenue in the community in so many different ways,'' said Gary Toebben, Lawrence Chamber of Commerce president.

KU Provost David Shulenburger, an economist, offered similar thoughts.

``Very large is how I would characterize our impact on the economic community,'' Shulenburger said. ``We're clearly talking millions direct, billions indirect in a year.''

But when you tally the dollars appropriated to KU by the state for salaries and facilities, the dollars that students have when they come to town, KU Endowment Association funds, research dollars, revenue from athletic activities, arts events and other sources, the picture becomes clearer.

``Our best estimate is that KU accounts for about 25 percent of the business activity in town,'' Toebben said.

That means one-quarter of the $9.35 million generated by Lawrence's 1 cent sales tax during fiscal 1998, which ended June 30, was created by or through KU. Overall, the amount of tax revenue generated by KU is about $200 million a year.

And when the economy of the state is humming -- bumper wheat crops, booming airplane and automobile sales, etc. -- KU and Lawrence benefit.

Purchasing power

Shulenburger said KU's total expenditures in Lawrence from all sources amount to about $370 million annually, including $100 million in tuition and fees, $100 million from the state, $40 million from endowment sources, $15 million in capital projects and millions more in research funding.

``Once we spend that money it goes in the hands of people, local people, who spend it then re-spend it,'' Shulenburger said. ``That happens two or three times. ... We're talking about a billion dollars of purchasing power that just comes directly from university expenditures.''

KU students plunk down another $150 million from their own wallets or parent-backed bank accounts. KU has 9,000 employees, and its presence in the state generates an additional 5,000 jobs. And KU's status as a research institution and its ability to attract federal research funding also contribute to its economic impact in the state.

Not just out-of-state students, but visitors as well, typically bring tons of new cash into the Kansas economy.

Shulenburger indicated about 2 million people come to Lawrence each year for KU-hosted events and camps.

``It would be hard to estimate how much each of those folks spends,'' he said.

The intangibles

In many ways, KU's impact on Lawrence could be likened to the proverbial rock in a still pond, as the effects go far beyond the directly financial.

Organizations such as New Generation, an active club of retirees, are working to attract specific demographic and economic groups back to the city, whether to start their family lives or to wind them down.

``This is not just Lawrence; universities across the country are attracting retired people back to the community,'' Toebben said, adding that many serve as volunteers at places such as the Lawrence Visitors Center in North Lawrence. ``Typically, they have created some wealth, their kids are no longer going to school. They really don't use the infrastructure of the community very much, but they have a lot to offer.''

In fact, the intangibles are virtually unlimited.

``Just look at what we haven't touched on -- what it is that the university does,'' Shulenburger said. ``We provide education and dramatically increase the earning potential of people who get bachelor's, master's and doctoral degrees.''

Also, plenty of businesses in Lawrence would not be here without Mount Oread, be it a spin-off from pharmaceutical research or businesses that locate here because there are university students to employ.

``The direct marketers are a prime example of that,'' Shulenburger said.

Then add to that a rich quality of life ``that people in towns of 75,000 people don't normally have,'' Toebben said. ``That you can't put a price on.''

-- Matt Gowen's phone message number is 832-7222. His e-mail address is mgowen@ljworld.com.

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