24 Chapter 2: Economic impacts on the Westchester County economy The $130.8 million in gross impact is often reported by researchers as the total impact. We go a step further to arrive at a net impact by applying a counterfactual scenario, i.e., what would have happened if a given event – in this case, the expenditure of in-county funds on SUNY WCC – had not occurred. SUNY WCC received an estimated 39% of its funding from sources within Westchester County. This portion of the college’s funding came from the tuition and fees paid by resident students, from the auxiliary revenue and donations from private sources located within the county, from state and local taxes, and from the financial aid issued to students by state and local government. We must account for the opportunity cost of this in-county funding. Had other industries received these monies rather than SUNYWCC, income impacts would have still been created in the economy. In economic analysis, impacts that occur under counterfactual conditions are used to offset the impacts that actually occur in order to derive the true impact of the event under analysis. We estimate this counterfactual by simulating a scenario where in-county monies spent on the college are instead spent on consumer goods and savings. This simulates the in-county monies being returned to the taxpayers and being spent by the household sector. Our approach is to establish the total amount spent by in-county students and taxpayers on SUNY WCC, map this to the detailed industries of the MR-SAM model using national household expenditure coefficients, use the industry RPCs to estimate in-county spending, and run the in-county spending through the MR-SAM model’s multiplier matrix to derive multiplier effects. The results of this exercise are shown as negative values in the row labeled less alternative uses of funds in Table 2.2. The total net impact of the college’s operations is equal to the gross impact less the impact of the alternative use of funds – the opportunity cost of the county money. As shown in the last row of Table 2.2, the total net impact is approximately $103.5 million in labor income and $6.1 million in non-labor income. This sums together to $109.6 million in total added income and is equivalent to supporting 1,363 jobs. These impacts represent new economic activity created in the county economy solely attributable to the operations of SUNY WCC. The total net impact of the college’s operations is $109.6million in total added income, which is equivalent to supporting 1,363 jobs. Table 2.2: Operations spending impact, FY 2021-22 Labor income (thousands) Non-labor income (thousands) Total income (thousands) Sales (thousands) Jobs supported Initial effect $94,406 $0 $94,406 $118,465 1,264 Multiplier effect Direct effect $5,185 $2,354 $7,539 $14,155 54 Indirect effect $1,105 $500 $1,605 $3,070 11 Induced effect $11,073 $16,207 $27,281 $41,819 150 Total multiplier effect $17,362 $19,062 $36,424 $59,043 215 Gross impact (initial + multiplier) $111,768 $19,062 $130,830 $177,508 1,479 Less alternative uses of funds -$8,260 -$13,000 -$21,260 -$38,461 -116 Net impact $103,508 $6,062 $109,570 $139,047 1,363 Source: Lightcast impact model.
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