Economic Impact Report

The purpose of this report is to lend support to a request from the Manhattan Area Technical College (MATC) for partial funding of a new technical education center on the MATC campus. The facility is projected to cost a total of $16.3 million and the MATC is requesting that the City of Manhattan provide $1.3 million of the cost based upon the projected sales tax and city utility revenues that the new MATC staff employees and graduates of the technical programs could produce for the city.

As documented below and in the Appendices of this report, the MATC plan could have the following economic impact on the City of Manhattan over the next ten years:

  • Increase in local sales tax revenues of about $1,556,000.
  • Increased city utility revenues of about $507,000.
  • Increased franchise fees of about $104,000.

The projected total direct revenues to the city would thus be about $2,167,000, or about 1.7 times the amount requested from the city for inclusion in the building costs. The cash flow back to the city would equal the $1.3 million grant during the 7th year (See Table 1 after the appendices), assuming that the first two years of the period would be for construction and the first graduates of technical programs would occur in the third year.

Program Impact:

Current Programs
Current Campus With Phase 1
Average annual graduates Collective Earnings Projected annual graduates Collective Earnings
Air Conditioning & Refrigeration 15 $600,000 30 $1,150,000
Construction Technology 10 $400,000 34 $1,350,000
Critical Environments Technology 3 $160,000 10 $450,000
Electric Power & Distribution 18 $1,080,000 24 $1,500,000
Industrial Engineering Technology 4 $180,000 12 $525,000
New Programs
Biomanufacturing - - - - - 24 $1,200,000
Plumbing Technology - - - - - 16 $800,000
Totals: 50 $2,420,00 150 $6,975,000

Economic Impact Study

City Revenues Generated Years 1-5 Years 6-10 Year 10
Sales tax from construction (labor & materials) $520,789 $0 $520,789
Sales tax from new staff jobs spending  $29,546 $33,467 $63,013
Sales tax from new graduate spending $259,600 $712,524 $972,124
Total Sales Tax: $809,935 $745,991 $1,555,926
Utility Net Profits $160,698 $346,163 $506,861
Franchise Fees $31,004 $73,073 $104,007
Total City Revenues $809,935 $1,165,227 $2,166,865

Impact of New Graduate Jobs

  Year 3 Year 6 Year 10 Totals
New Graduates in the Area per year 70 70 560
New Annual Personal Income $3,150,000 $10,206,431 $73,252,323
Disposable income $945,000 $3,061,929 $21,975,697
New Retail Sales $945,000 $3,061,929 $21,975,697
1st – 4th rollover totals $1,937,989 $6,279,347 $45,067,348
Total City Retail Sales $2,882,988 $9,341,276 $67,043,004
City Sales Tax Generated $41,803 $135,449 $972,124
County Sales Tax Generated $28,890 $93,413 $670,430

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