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Joe Cortright_Opportunity Dividend Summit
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The Fiscal Return on Education Joe Cortright March 2010
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Transcript of Joe Cortright_Opportunity Dividend Summit
The Fiscal Return on Education
Joe CortrightMarch 2010
Synopsis
RevenueExpenditure
A Thought Experiment
Revenue
Education & Income
Annual Household Adjusted Gross Income (AGI)
-
20,000
40,000
60,000
80,000
Less than HS High SchoolDiploma
1 to 3 Years ofCollege
4 Year Degreeor Higher
Source: American Community Survey, 2008
Oregon household income by education of household head, 2008
Distributions
Low Income High Income
HS DiplomaSome College
45.738.9
Taxes & Attainment
Educational Level of
Household Head Median AGI Tax Rate Total Tax
Less than HS 23,500 4.1% 1,000
High School Diploma 38,900 4.5% 1,800
1 to 3 Years of College 45,700 4.6% 2,100
4 Year Degree or Higher 64,800 4.8% 3,100
Most Taxes Come from Well Educated
Educational Level of Household HeadHouseholds Income Taxes
Less than HS 5.5% 1.8%
High School Diploma 24.5% 15.7%
1 to 3 Years of College 34.0% 29.0%
4 Year Degree or Higher 36.0%53.4%
Expenditure
Health Plan Percent on Oregon Health Plan, 2008
0.0%
5.0%
10.0%
15.0%
20.0%
Less than HS High SchoolDiploma
1 to 3 Years ofCollege
4 Year Degreeor Higher
Source: American Community Survey, 2008
Welfare Percent Receiving Welfare, 2008
0.0%1.0%2.0%3.0%4.0%5.0%
Less than HS High SchoolDiploma
1 to 3 Years ofCollege
4 Year Degreeor Higher
Source: American Community Survey, 2008
Unemployment Insurance
Percent receiving Unemployment Insurance, 2008
0.0%2.0%4.0%6.0%8.0%
10.0%12.0%
Less than HS High SchoolDiploma
1 to 3 Years ofCollege
4 Year Degreeor Higher
Source: American Community Survey, 2008
Corrections Percent of Persons Incarcerated, 2008
0.0%0.5%1.0%1.5%2.0%2.5%3.0%
Less than HS High SchoolDiploma
1 to 3 Years ofCollege
4 Year Degreeor Higher
Source: American Community Survey, 2008
A Thought Experiment
What if?
What if we moved 10,000 people from the category “high school graduate” to the category “four year college graduate”?
What would be the effect on state revenues?
What would be the effect on state expenditures?
Revenues
Revenue Per 4 Year Degree Holder 3,100Revenue per High School Graduate 1,800Difference per household 1,300
Adjustment for Household Size.60Difference per person$800
Aggregate Gain: $8 million annually
Expenditures
Program Participants Cost Savings
Welfare -160 8,500 1,360,000Health Plan -490 5,000 2,450,000UI -660 4,250 2,805,000Corrections -151 17,000 2,567,000
Total 9,182,000
Net Gain
Moving 10,000 from HS Graduate to 4-Year College Degree would produce annual gains of
Revenue: $8 million added
Expenditure: $9 million saved
Net Gain: $17 million
The Fiscal Return on Education
Joe CortrightJanuary 2010
