Can the Davenport Promise be Kept?
A closer look at the W.E. Upjohn Institute ‘Review of the Davenport Promise Concept’
Page 3: “The annual inflation rate during the period is 2.5 %.”
Comment: The 2009 Cost of Living Allowance (COLA) for local government Civil Service Retirement System (CSRS) retirees and Social Security recipients was 5.8%.
Page 3: “College tuition will increase at a rate that is no faster than inflation [i.e. 2.5%].”
Comment: Here are the tuition & fees and % increases for IA resident, 12 or more credits, at Iowa State University (ISU) and University of Iowa for the last ten years:
—Year—————–ISU*—————-U of Iowa**
2009/2010: $6650.70 ( 4.57 %)—– $6824 ( 4.27 %)
2008/2009: $6360.00 ( 3.22 %)—- $6544 ( 3.99 %)
2007/2008: $6161.00 ( 5.13 %)—– $6293 ( 2.57 %)
2006/2007: $5860.00 ( 4.01 %)—- $6135 ( 9.31 %)
2005/2006: $5634.00 ( 3.83 %)—- $5612 ( 4.00 %)
2004/2005: $5426.00 ( 7.91 %)—- $5396 ( 8.07 %)
2003/2004: $5028.00 (22.33 %)— $4993 (19.13 %)
2002/2003: $4110.00 (19.40 %)— $4191 (18.99 %)
2001/2002: $3442.00 ( 9.89 %)—- $3522 ( 9.92 %)
2000/2001: $3132.00 ( 4.26 %)—- $3204
1999/2000: $3004.00——————- NA
*Non-engineering ** Liberal Arts and Sciences
Page 3: “If tuition costs do outpace inflation, this will lower the impact of the Davenport Promise in drawing new residents into the city.”
Comment: By how much?
Page 4: “…a high level of uncertainty clouds the fiscal impact estimates of the Promise.”
Page 5: “The initial population change induced by the Promise may not be as strong as forecast.”
“The decline in the rate of new enrollments during the second and subsequent years after the enactment of the Promise may be greater than we forecast…If Davenport follows Kalamazoo, the fiscal impact of the program will worsen.”
“The response of property values and property tax revenues to a change in population may be slower than expected.”
Page 8: “The Davenport Public School…system does not compare well to its
neighboring schools… ”
Comment: Shouldn’t Davenport be more concerned with its underachieving school system than with post-secondary education?
Page 10: “During the past 16 years [for the Kalamazoo Promise], tuitions have increased at double the rate of consumer inflation.”
Comment: This invalidates the statement on page 3: “College tuition will increase at a rate that is no faster than inflation.”
Page 18: “…how many households will move to Davenport due to Promise…it is difficult to ascertain…from the Kalamazoo Promise.”
Page 19: “The enrollment impact of the Kalamazoo Promise fell off dramatically after the first year, dropping 90 percent.”
Page 20: “Employment would increase…most of these jobs will be in retail eating and drinking places.”
Comment: Davenport Promise will bring mostly minimum wage jobs.
Page 21: “It is being assumed that outside funding… will fund the administration and marketing…the City will not bear this cost as well.”
Comment: Is this guaranteed?
Page 27: “…Kalamazoo witnessed a 90 percent drop in the number of new enrollments in the second year…dissatisfaction with the Kalamazoo Public Schools, or the lack of employment opportunities in a sluggish regional economy may all play a part for this dramatic decline in new enrollments.”
“…if this [a second-year 60% decline in enrollments] proves to be overly optimistic, and the fall-off rate is higher, it would have a significant negative fiscal impact to the city.”
Page 28: “Davenport Promise could trigger a large increase in the number of homes put on the market…cancel[ing] the demand side impact of the Promise.”
Comment: This will result in lower tax revenues and property values.
Page 29: “…many believe that [Promise] is outside of a city’s responsibilities.”
Comment: We concur.
“In the middle scenario…the fiscal impact…would create an $8.8 million shortfall…over 7 years.”
“The high [achievement] scenario…would likely require additional funding for intensive increases in instruction.”
Comment: How will increases in education requirements be funded?
There are many un-answered questions and un-warranted assumptions. Are you willing to accept them?
At a minimum, we suggest different scenarios be modeled:
- 2.5 %, 5.0 % , and 7.5% inflation rates
- 60 %, 75%, and 90% second-year fall-off rates.
For more information or to get involved visit www.nomorepromises.com
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