By Tae Chong
Economic contributions of New Americans to Maine’s economy extend beyond jobs created and taxes paid. Every dollar an immigrant pays in taxes, or spends on the local economy, has a multiplying effect. In 2018, the City of Portland’s Office of Economic Opportunity reported that immigrants contributed $1.4 billion to the Greater Portland local economy through new businesses, wages, and taxes.That money in turn helped to grow other sectors of the economy. The economies of New Mainers and long-time Mainers are not just intertwined–they are one and the same.
Public school funding illustrates this point. For exploratory purposes, I will use Lewiston, Maine’s most ethnically diverse school district in the state. In 2018, according to Educate Maine, a local education think tank, there were 5,558 students enrolled in the Lewiston Public School System, including 2,487 multicultural students, or 44.7% of the school’s population.
What would Lewiston’s economy look like without New American families populating the schools? Let me start by acknowledging that reducing the number of school buildings, staff or programs in a district is not as straightforward as it might seem. Some programs must have a certain student-teacher ratio, and other programs cannot be cut because of state and federal education requirements.
However, even so, if multicultural students did not attend Lewiston public schools, almost half of the current school buildings and staff would be eliminated, and half the state education funding would be lost. Some buildings might be sold, for a one-time influx of revenue, but nearly half the staff and half the state’s funding would be cut.
In 2016, the Department of Education (DOE) gave Lewiston $41,790,794 in state education subsidies. If it received 44.7% less state funding, Lewiston would lose $19,641,673 per year. This is more than what the district paid in local taxes in 2018 for the entire population, which was $18.8 million. 44.7% of the current local portion would be $8.4 million. The local multicultural portion is less than ½ the state multicultural portion. In other words, for every local dollar spent on multicultural students in the Lewiston School, the state gave the district two dollars.
The number of multicultural students has a profound impact on the people whose lives are most directly impacted – teachers. The proposed budget for Lewiston public schools in 2020 is $77.8 million dollars. If this budget were to be cut by 44.7% (the percentage of multicultural students in the school district) Lewiston would lose $35.76 million dollars. What would Lewiston schools look like if they lost $35.76 million dollars in one year?
Approximately $35.76 million is spent annually by Lewiston staff and teachers. For every dollar spent on local businesses, a new car at the local car dealership, groceries at the local supermarket, mortgage payments with a local bank, entertainment and dining, about 73% stays in the community, creating a multiplier effect. This means the value of $35.76 million would be worth $61.86 million if all the money stayed in the local economy. If the $35.76 million was spent in big box stores or national chains, then 43% – or $51.13 – would stay in the local economy.
Since we don’t have hard data on how Lewiston teachers and staff spend their salaries, we should assume that some dollars are spent locally, and others are spent on national chains like Amazon, WalMart, or Target. So, for argument’s sake, let’s say that half is spent locally and half is spent on national chains, for an estimate of $56 million dollars spent by teachers and staff. Over a ten-year period, teacher and staff would have spent almost ½ billion dollar on the local economy.
Lewiston taxpayers spent $18.8 million to educate the entire student population last year. The local expenditure on multicultural students was $8.4 million. The $8.4 million-dollar investment in multicultural students had a 667% immediate return – or $56 million because of state subsidies and money spent locally. This means that for every dollar a Lewiston taxpayer paid for multicultural students, there was an almost $7 dollar return to the local economy. We are more connected than we realize as individuals, as communities, and as a state.
Lewiston Public Schools (2018)
Native American 0%
Pacific Islander 0%
Two or More Races 4%
Tae Chong is Manager of Social Enterprise and Workforce at Catholic Charities of Maine