Community/Rural/Urban Development, Public Economics,

Bangsund, Dean A.

Leistritz, F. Larry

English

Research Papers in Economics

AAE10002       April 2010
Economic Impact of Sitting Bull College
on the Regional Economy
F. Larry Leistritz and Dean A. Bangsund
1
As economic development has
become increasingly based on technology
and information, education and training
have become increasingly critical to the
economic well being of both individuals and
communities.  Thus, decision makers are
concerned that all North Dakotans have
access to quality education and training
programs.  Responsibility for provision of
workforce training and skills development
extends from the state’s research universities
to its community colleges.  This report
estimates the contribution of the Sitting Bull
College to the regional economy.
Sitting Bull College (SBC) was
founded in 1973.  Over time, the SBC has
grown and developed into a fully accredited
institution with strong relationships with
other institutions of higher education in the
region.  Currently, the SBC has about 300
students and offers 7 Bachlor of Science
programs as well as several Asssociate
degree and vocational programs.  
Purpose
The purpose of this study is to
measure the economic contribution of the
Sitting Bull College to the regional
economy.  An economic contribution
analysis, as defined in this study, represents
an estimate of all in-state expenditures and
returns associated with an industry, project,
or activity.  The economic contribution
approach to estimating economic activity
has been used for several similar studies 
(Bangsund and Leistritz 2007; Coon and
Leistritz 2001; Hodur et al. 2006a; Hodur et
al. 2006b; Leistritz et al. 2008).  This study 
treated the SBC as if it was a local industry
in the Fort Yates area, and employed
methods of estimating economic activity
that would be applicable to other industries
or basic sectors.  
Sitting Bull College can be easily
defined as a single business or public service
entity for purposes of estimating economic
activity.  Essentially, the college provides a
bundle of services, measured in terms of
students, educational attainment,  and
vocational activities.  Educational and
vocational services are treated as basic
sector activities. Through the provision of
those activities, the college purchases
inputs, incurs maintenance and upkeep on
facilities, expends resources for payroll, and
retains business and professional services. 
Thus, expenditures used to provide
educational and vocational services (basic
sector output) can be treated as the purchase
of outputs from other nonbasic sectors of the
regional economy.  Measuring those
expenditures (nonbasic sector outputs)
provides the basis for estimating the
magnitude of economic activity sustained
and created by the college’s ongoing
activities.  
As with any economic impact or
contribution analysis, measures of economic
activity are usually defined by the
magnitude of changes in direct and
secondary employment, secondary economic
activity, economy-wide personal income,
gross business volume, and tax collections. 
Therefore, measuring the contribution of the
SBC to the regional economy allows the
college, tribal leaders, and regional and state
1Leistritz is a professor and Bangsund is research scientist in the Department of Agribusiness & Applied
Economics, North Dakota State University, Fargo.policymakers a common perspective on the
relative economic size and influence of the
college to other activities and entities in the
region.
Methods
The initial task in any impact
assessment is estimating the direct impacts
(or “first-round effects”) of the activity
being studied. In this study, the SBC budget
for fiscal 2009 was analyzed to determine
expenditures made to entities in the North
Dakota and South Dakota region.  These
expenditures included both outlays for on-
going operations and one-time expenditures
for capital improvements.  The SBC has a
program of capital improvements which
suggests that expenditures for capital
improvements can be expected to continue
into the future.  The North Dakota Input-
Output Model was used to estimate the
secondary economic impacts based on these
data.
The North Dakota Input-Output
Model consists of interdependence
coefficients or multipliers that measure the
level of business activity generated in each
economic sector from an additional dollar of
expenditures in a given sector.  (A sector is
a group of similar economic units, e.g., the
firms engaged in retail trade make up the
retail trade sector.)  For a complete
description of the input-output model, see
Coon and Leistritz (1989).  The model
estimates the changes in gross business
volume (gross receipts) for all sectors of the
area economy resulting from the direct
expenditures (or direct impacts).   The
increased gross business volumes are used
to estimate secondary employment based on
historic relationships.  The procedures used
in the analysis are parallel to those used in
estimating the impact of other facilities and
activities (Leistritz and Coon 2008;
Bangsund and Leistritz 2004, Hodur et al.
2006).  Empirical testing has confirmed the
model’s accuracy in estimating changes in
levels of economic activity in North Dakota;
over the period 1958-2006, estimates of
statewide personal income derived from the
model averaged within 4 percent of
comparable values reported by the U.S.
Department of Commerce (Leistritz et al.
1990, Coon and Leistritz 2008). 
Results
The SBC expenditures to North
Dakota entities for fiscal year 2009 totaled
more than $9.7 million (Table 1).  The
economic sector receiving the greatest level
of expenditures was the Construction sector,
with nearly $3.6 million in outlays.  Other
economic sectors having substantial direct
spending included Households ($3.4
million), Retail Trade ($573,000), and
Finance, Insurance, and Real Estate
($856,000).  Direct expenditures by SBC in
most economic sectors, other than
Construction, represented the spending
associated with annual academic operations,
while spending in the Construction sector
represented the effects of ongoing programs
to improve and upgrade its facilities.
SBC expenditures (direct effects)
were allocated to the input-output model
sectors.  When the input-output model
coefficients were applied to these direct
impacts, secondary impacts were estimated
to total $17.3 million, with the largest
secondary economic activity occurring in
the Households ($6.3 million) and Retail
Trade ($5.3 million) sectors (Table 1).  The
secondary economic effects in the
Households sector represent economy-wide
personal income derived from the business
activity created by the spending and re-
spending of the direct effects as those first-
round expenditures flow through various
economic sectors of the economy.  Impacts
in the other economic sectors accrue in a
similar manner.
Total (direct plus secondary)
economic impacts totaled  $27.1 million. 
SBC has a substantial impact on economy-
wide personal income as approximately $9.7million or nearly 36 percent of the $27.1
million in gross business volume was
observed in the Households sector.  Total
economic effects were also substantial in the
Construction ($4.3 million) and Retail
Trade ($5.9 million) sectors.  The economic
contribution of the SBC also was sufficient
to support about 321 full-time equivalent
jobs in various sectors of the local and state
economies.  SBC directly supported 70
positions at the college in fiscal year 2009. 
Conclusion
The mission of the SBC is to provide
higher education opportunities, including
vocational and technical training, primarily
for Standing Rock reservation residents. 
Over time, the college has expanded its
programs and upgraded its facilities, and in
the process expanded its enrollment to about
300 students.  The benefits of the programs
offered by the SBC, both for individuals and
for the community are manifold, and some
would be difficult to quantify.  However,
this study demonstrates that the immediate
 economic impact associated with SBC
operations is substantial.  Further, because
the funding for SBC programs comes
primarily from out-of-state sources (e.g.,
federal programs, grants), the economic
impacts (contribution) discussed here
represent a contribution of new wealth to the
regional economy, as well as to the local
economies of several key regional trade
centers (e.g., Bismarck). 
Table 1.  Direct, Secondary, and Total
Economic Impacts of Sitting Bull College
Operations, Fiscal Year 2009
Economic Sector Direct Secondar
y
Total
----------------000s $ ------------
Construction 3,622 2,056 4,266
Communications
& public utilities
566 854 1,420
Retail trade 573 5,297 5,870
Finance,
insurance & real
estate
856 1,166 2,022
Business &
personal services
735 441 1,176
Professional &
social services
0 627 627
Households 3,356 6,295 9,651
Other
1 0 2,063 2,063
Total 9,708 17,387 27,095
1Includes agriculture, mining, transportation,
manufacturing, and government.
Table 2.  Direct and Secondary Employment,
Sitting Bull College, Fiscal Year 2009
Employment Category Number of
Jobs
Direct Employment 70
Secondary Employment (FTE)
1 321
Total Supported Employment 391
1 Full-time equivalent positions in various sectors of
the regional economy.References
Bangsund, Dean A. and F. Larry Leistritz. 
2007.  Economic Contribution of the
Petroleum Industry to North Dakota. 
AAE 559 & 559-S.  Fargo: North
Dakota State University. 
Bangsund, Dean A., and F. Larry Leistritz.
2004. Economic Contribution of the
Sugarbeet Industry to Minnesota,
North Dakota, and Eastern
Montana. AAE Rpt. No. 532. Fargo:
North Dakota State University.
Coon, Randal C., and F. Larry Leistritz.
2008.  North Dakota Input-Output
Model Data Base.  Fargo: North
Dakota State University.
Coon, Randal C., and F. L. Leistritz.  2001. 
Economic Contribution North
Dakota Cooperatives Make to the
State Economy.  AE 20011.  Fargo:
North Dakota State University
Coon, R. C., and F. L. Leistritz. 1989. The
North Dakota Economy in 1988:
Historic Economic Base, Recent
Changes, and Projected Future
Trends.  Agr. Econ. Stat. Series No.
45. Fargo: North Dakota State
University.
Hodur, Nancy M., Dean A. Bangsund, F.
Larry Leistritz, and John T. Kaatz.
2006.  “Estimating the Contribution
of a Multi-Purpose Event Facility to
the Area Economy,” Tourism
Economics 12 (2): 303-316.
Hodur, Nancy M., F. Larry Leistritz, and
Tarrand Hertsgaard.  2006. 
Contribution of the North Dakota
Agricultural Products Utilization
Commission Programs to the State
Economy.  AAE 06006.  Fargo:
North Dakota State University.
Leistritz, F. Larry, Dean A. Bangsund, and
Nancy M Hodur.  2008.  Economic
Impact of North Dakota Centers of
Excellence Program, 2007.  Special
report prepared for North Dakota
Department of Commerce,
Bismarck.  Department of
Agribusiness and Applied
Economics, North Dakota State
University, Fargo.
Leistritz, F. Larry, and Randal C. Coon. 
2008.  Socioeconomic Impacts of the
Langdon Wind Energy Center.  AAE
Rpt. No. 627.  Fargo: NDSU,
Department of Agribusiness &
Applied Economics.  
Leistritz, F. Larry, Steve H. Murdock, and
Randal C. Coon. 1990. "Developing
Economic-Demographic Assessment
Models for Substate Areas." Impact
Assessment Bulletin 8 (4): 49-65.
Acknowledgments 
The authors wish to thank Laurel
Vermillion, President, Sitting Bull College
and her staff, for her efforts in providing
data on in-region spending activities, and for
their comments on the manuscript.
Thanks are extended to Norma
Ackerson for document preparation and to
our colleagues for manuscript review.
Funding for the study was provided
by Sitting Bull College, Fort Yates, North
Dakota.Contact Information:
We would be happy to provide a single copy of this publication free of charge.  You can address
your inquiry to:  Department of Agribusiness and Applied Economics, North Dakota State University,
P.O. Box 6050, Dept. 7610 Fargo, ND, 58108-6050, Ph. 701-231-7441, Fax 701-231-7400, e-mail: 
ndsu.agribusiness@ndsu.edu. This publication also is available electronically at: 
http://agecon.lib.umn.edu/.
NDSU is an equal opportunity institution.
Copyright 2010 by Leistritz and Bangsund.  All rights reserved.  Readers may make verbatim
copies of the document for non-commercial purposes by any means, provided this copyright
notice appears on all such copies.
Department of Agribusiness and Applied Economics
Agricultural Experiment Station
Richard H. Barry Hall
North Dakota State University
Fargo, ND 58105-5636

Contribution of the North Dakota Agricultural Products Utilization Commission Programs to the State Economy. AAE 06006.

Developing Economic-Demographic Assessment Models for Substate Areas.&quot;

Economic Contribution North Dakota Cooperatives Make to the State Economy. AE 20011.

Economic Impact of North Dakota Centers of Excellence Program,

Estimating the Contribution of a Multi-Purpose Event Facility to the Area Economy,”

North Dakota Input-Output Model Data Base.

Economic Impact of Sitting Bull College on the Regional Economy

Economic Impact of Sitting Bull College on the Regional Economy

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Research Papers in Economics