For many post-industrial cities such as Syracuse, economies are no longer centered on making and manufacturing.

Universities and health care institutions – or “eds and meds” – are now at the center of inner city income generators. These anchor institutions, such as Syracuse University and the Upstate University Health System, are major stakeholders in the future of the cities they sit in.

“Gone are the days where local economies are centered on downtown main streets, for better or for worse,” said Liz Holden, a research and communications associate at the Initiative for a Competitive Inner City, an economic research organization. “Universities and hospitals were really the ones who lasted.”

Anchor institutions are rooted in communities because they often have too much invested in them to leave, Holden said. SU brings revenue to the city through student and visitor spending, employment opportunities, construction, housing and taxes and fees. This creates an annual economic impact of about $2.1 billion, said Keith Kobland, a media manager in the Office of News Services at SU.

The result is a give and take relationship between cities and institutions that means more than just money.

“Anchor institutions have a long-term plan to be there,” Holden said. “They’re the most permanent residence in the community, sometimes being there longer than some people’s lifespans.”

Student Spending, Taxes and Capital Projects

SU’s 21,492 students bring with them a great deal of spending power, said Marilyn Higgins, vice president of community engagement and economic development.

Each transaction brings sales tax, providing valuable dollars to local government – approximately $2,827,793 in 2013, according to SU’s Office of Government and Community Relations. Sales tax can come from the Carrier Dome, Food Services, the bookstore, parking and other areas. Taxes are also collected from the Sheraton Hotel and Drumlins.

SU also pays taxes to the local government for street closure fees, property taxes and water and sewer charges, the latter of which cost $867,886 in fiscal year 2006-2007, according to a report by SU on its economic impact.

But unlike other local revenue, student spending has an offseason.

“We dive way down in June and July, like it comes to a stop,” said J. Michael Shoes owner John Vavalo. “But that gives us time to reach out to the community and get them up on the hill.”

Since opening J. Michael Shoes 30 years ago, Vavalo said he’s seen businesses such as the Carrier Corporation come and go, and Bristol-Myers Squibb decline. In the midst of Syracuse’s vast industrial change, he said SU and Upstate have continued to sustain growth, making them the only businesses that “can’t leave town.”

With a continuously growing student body, SU has been expanding its housing options beyond campus and purchasing more and more properties downtown. Higgins pointed to Copper Beach Commons, an $18 million renovation project of a former National Guard Armory into student housing, according to the Office of Community Engagement and Economic Development.

Employment

SU pays a faculty of 1,968 full-time and part-time employees and a staff of 3,610 full-time and part-time employees. Its total payroll, including student employees, was $298,441,771, according to the university’s website.

Employment is an important factor of an anchor institution’s economic impact, Holden said. By providing local employment opportunities, anchor institutions increase demand for local goods and services, thereby generating more revenue in the community, according to the ICIC’s report on anchor institutions and economic development.

“Any decisions they make in terms of employment can make a ripple effect,” Holden said.

Some universities will also create training programs for local residents, providing them with skills that prepare them for jobs they were otherwise unqualified for at the university, Holden said. And while people will move from out of state to work at anchor institutions, Holden said these programs allow anchor institutions to utilize the local population at hand.

Community Engagement

An indirect contributor to SU’s economic impact comes from partnerships between the university and the city to revitalize declining neighborhoods. In 2005, then-Chancellor Nancy Cantor formed Scholarship in Action, which was created to forge connections with the local community, Higgins said.

Scholarship in Action led to the creation of the Near Westside Initiative, a non-profit organization in the Near Westside of Syracuse, the Connective Corridor, which links SU to downtown, and the Center of Excellence, a laboratory for eco-friendly innovation. The result was a relationship that profited both the city and the university, Higgins said.

SU’s engagement with the local community stretches far back before Scholarship in Action, Higgins said. And Chancellor Kent Syverud plans to continue that relationship, despite the term “Scholarship in Action” phasing out, she added.

“I believe that throughout this community, from every educational institution to the non-profit organizations in town, and the sports fans all over Upstate NY, SU is contributing to the quality of life in multiple ways,” Higgins said.

Like other cities, Syracuse has multiple anchor institutions – its top three major employers are Upstate, SU and St. Joseph’s Hospital Health Center, according to a 2010 report from the CenterState Corporation for Economic Opportunity.

Higgins said she believes education and health care institutions will continue to be strong stakeholders in Syracuse’s economy, as they have proven to be leaders.

“Fifty years ago, the president of Carrier Corporation would be chairing the business organizations,” Higgins said. “Now it’s our hospitals and universities doing that work.”

Published on March 25, 2015 at 10:58 pm

Contact Annie: apalme05@syr.edu