An Economic Analysis Of Locating Oregon\'s Custodial Institutions In Marion County and The City Of Salem

$Page 1: An Economic Analysis Of Locating Oregon\'s Custodial Institutions In Marion County and The City Of Salem$
An Economic Analysis of Locating Oregon’s Custodial Institutions in Marion County and the City of Salem

Nathan IsaacsThanh Tran

Fred Thompson

Willamette University’sCenter for Governance and Public Policy Research

ABSTRACTThe Center for Governance and Public Policy Research was asked to conduct an economic analysis of locating Oregon’s custodial institutions within Marion County and the city of Salem.The hypothesis considered was that these custodial institutions, and the attendant population connected to those institutions, place an undue burden on the budgets, infrastructure and services of local governments and public agencies. Our findings do not support the hypothesis.

KEY WORDS: Prisons; state mental hospital; economic spillovers; wages; employment; income; property taxes; economic development.

BIONathan Isaacs is a 2009 MBA candidate at the Atkinson Graduate School of Management with an emphasis in management consulting and finance. He is a former award-winning newspaper journalist and distinguished Navy submarine veteran.

Thanh Tran is a 2009 MBA candidate Atkinson Graduate School of Management with an emphasis in quantitative analysis and the financial markets of Southeast Asia.

Fred Thompson is the Director of the Center for Governance and Public Policy Research. He also is the Grace and Elmer Goudy Professor of Public Management and Policy Analysis at Willamette University’s Atkinson Graduate School of Management.


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Table of Contents

MAP OF OREGON AND MARION COUNTY .......................................................................... iii

INTRODUCTION ..........................................................................................................................1

LITERATURE REVIEW ................................................................................................................2

BACKGROUND ............................................................................................................................3

Community ...............................................................................................................................3

Prisons .......................................................................................................................................5

Federal Prison ...........................................................................................................................6

Juvenile Correction Facilities ...................................................................................................6

Marion County Sheriff’s Office Parole and Probation Division ...............................................7

State Hospital ............................................................................................................................7

RESEARCH ANALYSIS ...............................................................................................................9Wages ........................................................................................................................................9Income .....................................................................................................................................15Employment ............................................................................................................................15Property Taxes .........................................................................................................................19Income Taxes ..........................................................................................................................19Services ...................................................................................................................................20

Schools ..............................................................................................................................20Prison Families..................................................................................................................24Law Enforcement & Crime ...............................................................................................25Census ...............................................................................................................................29Prison Industries................................................................................................................30

Alternatives .............................................................................................................................31

CONCLUSION .............................................................................................................................31

BIBLIOGRAPHY .........................................................................................................................33

LIST OF GRAPHICS ...................................................................................................................34

APPENDIX A ...............................................................................................................................35

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ACKNOWLEDGEMENTSThe authors would like to thank the following agencies for their assistance in answering research questions and gathering requested information: Oregon Employment Department; Oregon Department of Corrections; Oregon Youth Authority; Oregon Department of Revenue; Oregon State Hospital; Salem Hospital; SEDCOR; Willamette University; Oregon State Hospital; Marion County Sheriff’s Office; Salem-Keizer School District.

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MAP OF OREGON & MARION COUNTY

Willamette University’s Center For GovernanCe and PUbliC PoliCy researChAn Economic Analysis Of Locating Oregon’s Custodial Institutions In Marion County

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INTRODUCTIONWillamette University’s Center for Governance and Public Policy Research was requested to

conduct an analysis of the economic effect of Oregon’s state custodial institutions on the Marion County and Salem economies. The hypothesis which we were asked to consider is that these custodial institutions, and the attendant populations associated with those institutions, place an undue burden on the budgets, infrastructure and services of the local governments and public agencies within the county.

For the purposes of this research, those institutions that were evaluated included the Oregon State Correctional Institution; Oregon State Penitentiary; Santiam Correctional Institution; Mill Creek Correctional Facility; the Hillcrest and MacLaren Youth Correctional Facilities; and the Oregon State Hospital. These seven custodial institutions currently have about 2,300 employees; more than $100 million combined annual payroll; and about 3,900 adult inmates, 475 juvenile inmates, more than 600 mental health patients/inmates. We also studied the effect of an estimated 4,400 people who are paroled and/or under post-prison community supervision in Marion County and administered by the Parole and Probation Division of the Marion County Sheriff’s Office.

This analysis is expected to serve as a benchmark of empirical research for policy makers at the state and local levels. Up to now, without such information being collected and analyzed into one document, perceptions may have served as reality in these, often vibrant, political and community discussions about the community’s custodial populations. This analysis does not attempt to quantify the social costs and/or benefits associated with incarcerating convicted juvenile and adult criminals in Marion County-area correctional facilities, or evaluating/treating the mental health problems of those being held or committed to the Oregon State Hospital.

This study was performed in the four-month period between May and August 2008. The purpose of this project is to provide information through reliable primary and secondary data that will show the effects these custodial institutions have on the Marion County and Salem economies. The study also exposes a need for more research on this subject.

We have tested our hypothesis through several research methods, including an examination of wages, income, employment, property taxes, and delivered services. The focus of the study was to be on the quantitative economic effects these custodial institutions had in the local economy. However, we also have identified the qualitative effects and spillovers associated with custodial institutions and compared those with spillovers associated with Willamette University and Salem Hospital.

It is axiomatic that economic development is not generally associated with job creation, but with substituting more productive jobs for less productive jobs. As a first approximation, wages are a reasonable proxy for productivity. Consequently, we collected wage data for identified custodial institutions, which we compared with the State of Oregon, the Salem Metropolitan Statistical Area


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(MSA), Willamette University, Salem-Keizer School District and with the Salem Hospital, the county’s largest private employer. We evaluated the differences in those wages and considered any effects they may have on the local economy. Effects can arise directly, indirectly through business-to-business transactions, primarily through an entity’s supply chain, or induced, as the result of payroll spending. When added, the direct, indirect, and induced effect equals the total economic effect that the subject custodial institutions have in Marion County.

We also attempted to quantify the expense of providing public services to those institutions. This could include hiring more police officers, sheriff’s deputies and other first responders; require providing healthcare to an increasing number of indigent people; or have a disproportionate number of students who require extraordinary care (realized in free and reduced lunches, special education, social supervision or other services). We then subtracted these service costs from the total economic effect to arrive at the net economic effect of having about 9,400 people, or about 3 percent of the county’s population, either in custody or under some type of court-ordered community supervision.

LITERATURE REVIEWThe business of prisons and their effect on Oregon communities was examined in the April

2008 issue of Oregon Business magazine. The article created a stir throughout the state when it suggested that, while prisons may bring jobs to a rural community, they did not bring prosperity. Much of the empirical research done on the subject of the economic effects of prisons has dealt with rural communities. This is hardly surprising, as Besser and Hanson (2003) report in “Development of Last Resort: The Impact of New State Prisons on Small Town Economies,” prisons are moving from metropolitan locations to non-metropolitan areas. Only ten percent of prisoners housed in state prisons built in the 1990s are located in metropolitan locations; sixty-nine percent are located in smaller communities that have relatively high poverty levels, unemployment rates and low household wages.1

As Oregon Business suggests, the benefits to these communities of hosting prisons are somewhat controversial. In 2001, Christopher Setti et al. (2001) carried out an analysis of the economic effects of the six prisons constructed in Eastern Colorado’s rural plains since 1985. They show that per capita income in the six prison counties increased significantly relative to non-prison counties, primarily because prison jobs pay better than agricultural and service jobs. However, the authors insist that building a prison does not guarantee future prosperity. While counties hosting prisons did better than other rural counties, they continued to lag behind the state as a whole. A January

1 From an analytic standpoint, locating prisons in rural areas is convenient because one can expect their effects to be both identifiable and uncontaminated by other factors.


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2002 article published in FedGazette arrived at a similar conclusion. It assessed the results of locating a federal prison in Stanley, Wisconsin, a small town (1,898 inhabitants) with a declining population in a high unemployment high wage region. They concluded that the facility created 400 jobs directly and indirectly another 319, but did not significantly increase average wages. In contrast, “Big Prisons, Small Towns: Prison Economics in Rural America” (King, Mauer & Huling 2003), claims that rural counties in New York, where prisons have been sited after 1982 have not grown significantly faster in either in terms of employment or in terms of per capital income than other similar counties.

The conclusion that might be drawn from these studies is that prisons are likely to have a positive economic effect only where wages are relatively low and that this effect will be significant only where unemployment is high.

BACKGROUND

CommunityMarion County is one of 36 counties in Oregon. The county encompasses nearly 1,200 square

miles, stretching from the Willamette River in the west and to the Cascade Mountains in the east. The county is bordered by seven others (clockwise): Clackamas, Wasco, Jefferson, Linn, Benton, Polk, and Yamhill.2 Marion County includes 20 incorporated cities and 37 unincorporated communities (see Table 1). The county had an estimated July 1, 2007 population of 311,070.3 The county had an estimated 140,203 employed in the labor force and a 5.4 percent unemployment rate in 2007.4

The county is the state’s largest producer of agriculture, producing more than 150 cash crops and food processing is among the county’s largest industries.5 The county is also home to 38 of the largest state agencies employing 18,143 people in 2007.6 The county also is home to Willamette University, Chemeketa Community College and Corban College.

Salem stretches over 47 square miles. It is the state’s capital as well as the county seat and largest city in Marion County with a population of 152,290.7 It is also the second largest city in the state. The Salem MSA is one of six in the state and includes both Marion and Polk counties. The Salem MSA had a 2005 GDP of $10.4 billion (see table 2).8

2 Oregon Blue Book. http://bluebook.state.or.us/local/counties/counties24.htm3 Population Research Center, Portland State University4 Oregon Employment Department5 Oregon Blue Book. http://bluebook.state.or.us/local/counties/counties24.htm6 Oregon Employment Department7 Population Research Center, Portland State University8 Bureau of Economic Analysis, U.S. Department of Commerce


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Among the largest employers in the Salem MSA, as of December 31, 2007, include state and local government, 19,100 employees and 17,800 employees, respectively; Salem Hospital, 3,500 employees; T-Mobile, 1,100 employees; Norpac Foods, 1,100 employees; Truitt Bros. Inc., 919 employees; SAIF Corporation, 711 employees; Kaiser Permanente, 550 employees; Wachovia, 510 employees (See Appendix A).

In late September 2008, Salem and Marion County proudly announced that Sanyo Solar of Oregon would build an $80 million solar-cell manufacturing plant in southeast Salem. The facility is expected to employ about 200 people.

Table 1: Population Estimate for Marion County and its incorporated cities

Population Estimates for Oregon and Marion County and Incorporated Cities: April 1, 1990 - July 1, 2007Prepared by Population Research Center, PSU, March 2008.

2007 2006 2005 2004 2003 2002 2001 2000 2000 1990

OREGON 3,690,505 3,631,440 3,582,600 3,541,500 3,504,700 3,471,700 3,436,750 3,421,399 2,842,321

MARION 311,070 306,665 302,135 298,450 295,900 291,000 288,450 286,300 284,838 228,483Aumsville 3,300 3,205 3,130 3,080 3,050 2,980 3,000 3,050 3,003 1,650Aurora 955 920 785 660 660 660 660 660 655 567Detroit 265 260 255 250 250 250 260 260 262 331Donald 995 895 750 660 640 630 610 620 625 316Gates (part)* 460 455 450 445 445 435 435 430 429 458Gervais* 2,250 2,250 2,240 2,130 2,110 2,070 2,080 2,045 2,009 992Hubbard 3,095 2,960 2,855 2,750 2,700 2,560 2,510 2,500 2,483 1,881Idanha (part)* 145 145 145 145 145 145 145 145 147 177Jefferson 2,590 2,590 2,515 2,490 2,480 2,470 2,540 2,505 2,487 1,805Keizer 35,435 34,880 34,735 34,380 34,010 33,100 32,950 32,515 32,203 21,884Mill City (part)* 328 325 315 310 310 295 305 305 312 308Mt. Angel 3,755 3,665 3,630 3,600 3,700 3,660 3,400 3,130 3,121 2,778St. Paul 410 420 415 400 390 380 350 355 354 322Salem (part)* 129,830 127,720 126,525 123,890 123,410 122,290 120,920 119,790 119,040 94,990Scotts Mills 300 300 300 300 300 300 310 315 312 283Silverton 9,205 8,915 8,230 8,060 7,980 7,680 7,420 7,470 7,414 5,635Stayton 7,765 7,700 7,505 7,360 7,300 7,200 6,960 6,870 6,816 5,011Sublimity 2,255 2,225 2,225 2,160 2,160 2,120 2,150 2,170 2,148 1,491Turner 1,690 1,645 1,570 1,480 1,480 1,400 1,340 1,200 1,199 1,281Woodburn 22,875 22,615 22,110 21,790 21,560 20,860 20,410 20,310 20,100 13,404Unincorporated 83,168 82,575 81,450 82,110 80,820 79,515 79,695 79,655 79,719 72,919

Please use caution when comparing the population estimates of the unincorporated county areas over time, and note that population estimates for the unincorporated areas represent revised estimates rather than estimates resulting from direct change during the year.

County and Cities

July 1 Population EstimatesCensus Population,

April 1

3,745,455

Table 2: Total GDP (in millions)

Metropolitan 50024002300220021002aerABend, OR 038,3)ASM( 4,127 4,520 5,063 5,666 Corvallis, OR 904,2)ASM( 2,764 2,956 3,426 3,473 Eugene-Springfield, OR 879,7)ASM( 8,610 9,017 9,848 10,425 Medford, OR 404,4)ASM( 4,729 5,072 5,604 5,988 Portland-Vancouver-Beaverton, OR-WA (MSA) 77,181 79,407 81,556 90,839 95,573 Salem, OR 464,8)ASM( 9,145 9,768 10,448 11,147

Source: Bureau of Economic Analysis, U.S. Department of Commerce

Total GDP (in millions)

Table 1: Population Estimate for Marion County and its Incorporated Cities

Table 2: Total Gross Domestic Product (in millions)


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PrisonsWhy is Salem home to the state’s prison and Eugene the state university? According to local

legend, Salem had first choice. The Oregon Constitution, in fact, once stated (article XIV, Sec. 3, since repealed), “all public institutions of this state, other than public institutions located outside Marion County prior to November 1, 1958, shall be located in Marion County.” The point is that these institutions were once seen as engines of economic growth and development.

In 1864, the state purchased 147 acres of land from the Morgan L. “Lute” Savage Donation Land Claim for a penitentiary, at a price of $9,019.17.9 The Oregon State Penitentiary (OSP) was moved from Portland to Salem in 1866 to a 26-acre site on the property, where it remains today and is the state’s only maximum-security prison. Since then, another three state prisons have been added to the Marion County and Salem community.

The Oregon State Correctional Institution opened in 1959 as a medium-security facility. The Santiam Correctional Institution was built in 1946 and was used as an annex to the Oregon State Hospital for mental health patients. In 1977, the Department of Corrections began using the facility as a minimum custody pre-release center and in 1990 became the Santiam Correctional Institution. The Mill Creek Correctional Facility is located on the former Boys’ Training School site, which was turned over to the state in 1929 to be run as a prison farm. In 1992, the Mill Creek facility was merged with Santiam Correctional Institution for administrative efficiencies. All three institutions are located on the eastern outskirts of Salem.10

The state Department of Corrections has a total of 14 correctional facilities throughout the state with a total prison population, as of January 2007, of about 13,291 inmates of which about

9 Becker, Thomas; et al. Cultural Resources Investigation of the Oregon State Hospital Property, Marion County, Oregon. Architectural Resources Group. January 2008.10 Oregon Department of Corrections, http://egov.oregon.gov/DOC/OPS/index.shtml; and Oregon Secretary of State Archives, http://arcweb.sos.state.or.us/state/odc/hist/current_org_smci.htm.

Custodial Institution Inmates/Patients

Employees

Oregon State Penitentiary 2,313 538 Oregon State Correctional Institution 884 250 Santiam Correctional Institution 431 113 Mill Creek Correctional Facility 275 51 Hillcrest Youth Correctional Facility 180 191 MacLaren Youth Correctional Facility 295 XXX Oregon State Hospital 600 1201 Parole and Community Supervision 4,400 XXX Parole and Post Prison Supervision (Absconded) 1,600

Total 9,433 3,245 Source: Oregon Department of Employment

300

69

Table 3: State Custodial Institutions in Marion County


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29 percent or 3,903 were in the four Marion County institutions.11 That is a 16 percent drop from 1997 when the four institutions housed 45 percent of the state’s prisoners, or 3,823 of the 8,531 inmates.

The adopted 2007-2009 biennial budget for the Department of Corrections was $1.3 billion, about 19 percent more than its previous budget. The four prisons located in Marion County have 2007-2009 biennial budgets of about $156 million combined with the Oregon State Penitentiary making up about 52 percent of that amount.

The department also was budgeted about $10 million to begin the initial planning and design of its next prison, which is not scheduled to be opened until late 2012 or 2013. However, the Department of Corrections and the state are readying themselves for the fiscal and operational impact that either one of two November ballot measures would have if passed by voters, which is expected.

One of the initiatives, sponsored by Republican activist Kevin Mannix, would set mandatory three-year minimum prison sentences for drug dealers, burglars and identity thieves regardless of their criminal history. Its implementation is estimated to cost more than $200 million a year. The Legislature is giving voters a second, less expensive, option that would beef up property crime and identity theft sentences, as well as add money for drug treatment. That measure is expected to cost about $50 million annually. The Mannix measure would add about 4,000-6,000 inmates to Oregon’s prison system. The countermeasure would add about 1,400 inmates. If both measures pass, the one with the most votes will become law beginning in January 2009.

The Department of Corrections, as of August, had not released plans on how it would accommodate the influx of prisoners. Initially, based on prison over-crowding examples elsewhere nationally, some of the burden of housing those inmates would be placed on Oregon’s county jails. That, in turn, could force booking restrictions, meaning some suspected criminals, depending on their crime, would be booked into the criminal system following their arrest and then released from jails, pending the outcome of their criminal trials.

Federal PrisonThe state has only one federal prison, the Federal Correctional Institution in Sheridan, which is

within 30 miles of Salem and located in Yamhill County. It is a medium-security prison that houses about 1,900 male offenders. The facility also includes a detention center for male offenders and an adjacent minimum-security satellite prison camp that also houses male offenders.12

Juvenile Correction FacilitiesThe Oregon Youth Authority operates seven secure correctional facilities in the state housing

about 800 inmates. The Hillcrest Youth Correctional Facility is located in Salem and houses about

11 Oregon Department of Corrections, “Quick Facts” and “Biannual Inmate Profiles,” www.oregon.gov/DOC/12 Source: Federal Bureau of Prisons


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180 youth inmates. The MacLaren Youth Correctional Facility is located in Woodburn and houses about 295 youth inmates. The Oregon Youth Authority has a biennial budget of $305 million – of which the two Marion County institutions have budgets of $42.2 million for MacLaren and $25.8 million for Hillcrest.

Marion County Sheriff’s Office Parole and Probation DivisionThe Marion County Sheriff’s Office Parole and Probation Division supervise about 4,400

offenders and another 1,600 offenders who have failed to check in with their parole officer and likely have left the area. The division’s caseload is organized into geographic regions within the county. There are also specialized caseloads for sex offenders, drug offenders, gang offenders and domestic violence cases.

State Hospital In 1883, less than a mile to the north of the Oregon State Prison, the state mental hospital,

originally called the Oregon State Insane Asylum, was built on what has evolved to a 144-acre campus that includes 72 buildings which are scattered around several park-like landscaped areas.13A majority of the buildings were built between 1883 and 1958. Two of the buildings are listed as local landmarks by the City of Salem – the Dome Building, which was built in 1912, and the J Building, which was built in phases between 1883 and 1915.14

Most of the hospital’s patients were committed to the hospital from criminal courts, including those “incompetent to stand trial,” those hospitalized for treatment and competency restoration before returning to trial, and those found “guilty except for insanity.” The remaining patients were committed by civil court.15

In recent years, the state mental hospital has made news headlines, sparked controversies and prompted several state and federal investigations into conditions and care given at the facility. The Oregonian newspaper earned a 2005 Pulitzer Prize for its editorials that focused on the years of neglect at the hospital, which is the oldest psychiatric hospital still in use on the West Coast.16 The hospital is also popularly known as the setting for the Academy Award winning1975 film, “One Flew over the Cuckoo’s Nest.”

Following those state and federal investigations, and a consultant’s report that the building’s disrepair was beyond renovation, the state Legislature in 2007 authorized $458 million to build two new hospitals in the coming years. Among the criteria used in selecting the two sites was

13 Becker, Thomas; et al. Executive Summary: Cultural Resources Investigation of the Oregon State Hospital Property, Marion County, Oregon. Architectural Resources Group. January 2008.14 ibid15 Oregon State Psychiatric Hospital Replacement Site Recommendations Document. Published Jointly by the Department of Human Services and the Department of Administrative Services. 2007.16 “The Oregonian Captures Pulitzer for ‘Forgotten Hospital’” Dave Hogan. The Oregonian. April 18, 2006.


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spelled out in three basic questions: Did the proposed site meet the acreage and location (a north and central location in western Oregon) needs; how well did the proposed site meet technical site attributes and cost requirements; and how well did the proposed site meet programmatic needs and support requirements? (See Table 4).

According to the site selection document developed by the Departments of Human Services and Administrative Services, the main factor for choosing the two sites was that they were closer to population centers and to those who were most likely to utilize the hospitals’ services.

The approved recommendations resulted in an estimated $250 million, 620-bed, 680,000 square-foot mental hospital being built on the current campus in Salem beginning in 2009 and is expected to be opened by 2011. The second hospital, with 360 beds, will be built in Junction City (just north of the Eugene-Springfield MSA) in 2013. The Junction City property, a 242-acre parcel, is owned by the Department of Corrections and was originally planned for a two-stage new prison project, including a 1,640-bed minimum- and medium-security lockup.17

Earlier this year, Salem Mayor Janet Taylor spoke out against the proposed new mental hospital, saying it would add to the city’s reputation as a home for criminals and people with mental illness.

“For too long, the Salem area has shouldered a disproportionate share of the state’s burden for providing group homes for patients discharged from the hospital’s program for the criminally insane,” Taylor was quoted in the Salem Statesman Journal. “I’m not taking a NIMBY (Not In My Backyard) attitude. I’m talking what is fair for the patients, the employees, and the Salem area. It is only fair that we do our share of the load for incarcerating people and treating people with mental illness. But it’s not fair if we’re taking it for the whole state.”18

She has since relented to the hospital’s construction in her city, but still advocates that the size of the Salem project be reduced and that a third hospital should be built in the Portland metro area. State officials have said any changes now would be too costly.

17 “State officials evaluating sites for new psychiatric hospitals” Register Guard. Jan. 5, 2007.18 “Salem mayor opposes new Oregon state hospital” The Associated Press, Jan. 29, 2008.

Table 4: SITE EVALUATION RANKINGS

NORTHERN SITES RANK TECHNICAL PROGRAM COMBINED Oregon State Hospital grounds – Salem 1 184 172 356 DOC – Turner Rd/Deer Park – Salem 2 165 169 334 Reeds Crossing – Hillsboro 3 146 168 314 Shute Road – Hillsboro 4 150 159 309

SOUTHERN SITES RANK TECHNICAL PROGRAM COMBINED OC – Junction City 1 162 160 322 Coker Butte – Medford 2 185 126 311 KOGAP Orchard – Medford 3 183 119 302 Airport Breeze – Medford 4 131 138 269

Source: Oregon State Psychiatric Hospital Replacement Site Recommendations Document

Table 4: Site Evaluation Rankings


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RESEARCH ANALYSIS

WagesAs we analyzed the 2007 wage data for Oregon and the Salem MSA, we found that the average

(mean) annual wage for the Salem MSA was $40,350, which was about $4,000 less than the Oregon state average of $44,437.19 In comparison with Oregon’s five other MSA regions, the Salem MSA’s average annual wage was only higher than that of Medford’s $39,267 (see Figures 1-4). The median annual wage for Salem MSA was about $35,400.

19 This data came from the U.S. Department of Labor and excluded: (1) wages for some occupations that do not

generally work year-round or full-time; (2) wages that were equal to or greater than $70.00 per hour or $145,600 per year; and (3) industry wage estimates that were not released.

1200001050009000075000600004500030000

Median

Mean

4200040000380003600034000

A nderson-Darling Normality Test

V ariance 334340697Skewness 1.43308Kurtosis 2.68021N 323

Minimum 18170

A -Squared

1st Q uartile 27430Median 354003rd Q uartile 49760Maximum 124110

95% C onfidence Interv al for Mean

38348

8.89

42351

95% C onfidence Interv al for Median

33424 38201

95% C onfidence Interv al for StDev

16975 19815

P-V alue < 0.005

Mean 40350StDev 18285

95% Confidence Intervals

Summary for Mean Annual - Salem, Oregon -2007

14000012000010000080000600004000020000

Median

Mean

460004400042000400003800036000


V ariance 406405320Skewness 1.58891Kurtosis 3.86745N 635

Minimum 18480

A -Squared



42866

17.51

46008


37240 40655


19108 21334

P-V alue < 0.005



Summary for Mean Annual - Oregon -2007

Figure 1: Mean annual wages for Salem MSA in 2007

Figure 2: Mean annual wages for Oregon in 2007


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Among the Salem MSA’s top occupations, ranked by number of workers, were Retail Sales (5,700), Cashiers (4,260), General Office Clerks (4,080), and Food Preparation (including Fast Food) (2,780). Among the Salem MSA’s top wage earners are General Dentists (mean annual salary $124,110), Chief Executives ($122,290), Pharmacists ($102,530); and general and operations managers ($99,920). Among the Salem MSA’s top occupations ranked by both annual salary and number of employments are general and operations managers, registered nurses, all other managers, and computer specialists (see Tables 5-7).

Figure 3: 2003-2007 Annual Wage Trend of Salem MSA & Oregon

$38,992 $39,462

$40,433

$42,544

$44,437

$37,436 $37,793 $38,566 $38,243

$40,350

$32,000

$34,000

$36,000

$38,000

$40,000

$42,000

$44,000

$46,000

2003 2004 2005 2006 2007

Oregon State (Average) Salem MSA (Average)

Source: U.S. Department of Labor, Bureau of Labor Statistics

Figure 4: Mean Annual Wage in Oregon's Six Metropolitan Service Areas in 2007

$40,350 $41,085

$41,828 $41,770

$39,267

$46,050

$34,000

$36,000

$38,000

$40,000

$42,000

$44,000

$46,000

$48,000

Salem Bend Corvallis Eugene-Springfield Medford Portland-Vancouver-Beaverton


Figure 3: 2003-2007 Annual Wage Trend of Salem Metropolitan Service Area and Oregon

Figure 4: Mean Annual Wage in Oregon’s Six Metropolitan Service Areas in 2007


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The mean annual wages in 2007 for the combined custodial institutions, Willamette University, Salem-Keizer School District and Salem Hospital were dramatically higher than the Salem and Marion County averages (see Tables 8-10). Salem Hospital has the highest mean annual wage of $60,380. Willamette University has a mean annual wage of $55,617.20 And the custodial institutions (except the state hospital) have a mean annual wage of $51,214. Those averages are in the upper 75% quartile for the Salem MSA. The Salem-Keizer School District average wage for teachers of $48,517 was for the 2006-2007 school year and, as such, would be just at the upper 75 percent quartile for the area. The Oregon State Hospital’s $45,372 mean annual wage is slightly higher than the Oregon state average of $44,437 and significantly higher than the Salem MSA average.

20 This excludes adjunct faculty. If all were accounted the average wage would drop to $53,249.

Table 5: Top occupations by number of employees in Salem MSA in 2007

Employment Median Hourly ($) Mean Hourly ($) Mean Annual ($)Retail Salespersons 5,700 10.34 12.22 25,420Cashiers 4,260 9.02 9.83 20,440Office Clerks, General 4,080 13.13 13.25 27,550Combined Food Preparation And Serving Workers, Including Fast Food 2,780 8.68 8.85 18,400Customer Service Representatives 2,650 12.51 13.89 28,890Laborers And Freight, Stock, And Material Movers, Hand 2,360 11.04 12.4 25,800Registered Nurses 2,330 32.54 31.77 66,080Janitors And Cleaners, Except Maids And Housekeeping Cleaners 2,200 11.65 12.21 25,400Bookkeeping, Accounting, And Auditing Clerks 2,120 15.09 15.84 32,940Truck Drivers, Heavy And Tractor-Trailer 2,110 16.09 16.66 34,650

Occupation Wage Estimates


Employment Median Hourly ($) Mean Hourly ($) Mean Annual ($)Dentists, General 110 57.81 59.67 124,110Chief Executives 190 55.99 58.8 122,290Pharmacists 210 50.01 49.29 102,530General And Operations Managers 1,860 42.61 48.04 99,920Judges, Magistrate Judges, And Magistrates 50 45.99 46.02 95,720Sales Managers 160 41.96 44.96 93,510Computer And Information Systems Managers 100 43.93 43.87 91,260Medical And Health Services Managers 170 40.6 42.84 89,110Lawyers 650 39.58 42.23 87,830Financial Managers 250 37.7 40.64 84,540

Occupation Wage EstimatesTable 6: Top occupations by mean annual wage in Salem MSA in 2007


Table 7: Top occupations by both mean annual wage and the number of employees in Salem MSA in 2007

Employment Median Hourly ($) Mean Hourly ($) Mean Annual ($)068,1sreganaM snoitarepO dnA lareneG 42.61 48.04 99,920 033,2sesruN deretsigeR 32.54 31.77 66,080 004,1rehtO llA ,sreganaM 31.36 31.27 65,050 043,1rehtO llA ,stsilaicepS retupmoC 28.75 28.52 59,320

Truck Drivers, Heavy And Tractor-Trailer 2,110 16.09 16.66 34,650 Bookkeeping, Accounting, And Auditing Clerks 2,120 15.09 15.84 32,940

056,2sevitatneserpeR ecivreS remotsuC 12.51 13.89 28,890 080,4lareneG ,skrelC eciffO 13.13 13.25 27,550 007,5snosrepselaS liateR 10.34 12.22 25,420 062,4sreihsaC 9.02 9.83 20,440

Occupation Wage Estimates


Table 5: Top occupations by number of employees in Salem Metropolitan Service Area in 2007

Table 6: Top occupations by mean annual wage in Salem Metropolitan Service Area in 2007

Table 7: Top occupations by both mean annual wage and the number of employees in Salem Metropolitan Service Area in 2007


12

To assess further the wage characteristics of these institutions relative to the community in which they are located, we constructed a statistic model showing the distribution of jobs in terms of annual wages characteristic of each (See Figures 5-8). The bottom line is relatively unambiguous. To the extent that wages are a satisfactory proxy for productivity – it should be a pretty good one – the direct economic effect of these institutions is positive. They make a significant contribution to the economic product of the Salem SMA, especially Salem Hospital. Their overall effect is to

Category Employees Percentage Total Payroll Average Annual ($)Staff Rn 702 29% 52,492,752 677,47 Other Clinical 550 23% 34,308,560 973,26 Clinical Support 317 13% 10,173,925 490,23 Other Professional 97 4% 6,522,901 642,76 Administrative Support 232 10% 8,246,950 745,53 Facilities Support 293 12% 9,153,789 242,13 Physicians 11 0% 2,607,280 027,622 Management 212 9% 22,281,709 201,501

668,787,541414,2latoT083,06egarevA

Table 8: Annual mean wages in 2007 for Salem Hospital

Source: Salem Hospital

Category Employees Percentage Total Payroll Average Annual ($)

205,52355,473,1%845ytlucaF tcnujdA 354,46414,579,01%52071noitartsinimdA 930,13006,346,6%13412deifissalC 409,47845,036,51%13902ytlucaF 346,84990,578,1%693lanoisseforP

Total 685 100% 36,499,214 53,284 55,617 Average (Excluding Adjunct Faculty)

Table 9: Annual mean wages in 2007 for Willamette University

Source: Willamette University

Table 10: Annual mean wages in 2007 for state custodial institutions in Marion County and State Hospital in Salem

Source: Oregon Department of Employment

Category Employees Percentage Total Payroll Average Annual ($)

Oregon State Correctional Institution 250 22% 12,996,733 51,987 Oregon State Penitentiary 538 47% 28,185,904 52,390 Santiam Correctional Institution 113 10% 5,520,296 48,852 Mill Creek Correctional Facility 51 4% 3,038,097 59,571 Hillcrest Youth Correctional Facility 191 17% 8,264,166 43,268 MacLaren Youth Correctional Facility

Total 1,143 100% 58,005,196 50,748

Oregon State Hospital 1,201 100% 38,657,014 32,187

Table 8: Annual mean wages in 2007 for Salem Hospital

Table 9: Annual mean wages in 2007 for Willamette University

Table 10: Annual mean wages in 2007 for state custodial institutions in Marion County and State Hospital in Salem


13

Figure 5: Comparison of 2007 annual mean wages in Marion County

$40,350

$44,437 $45,372 $48,517

$51,214

$55,617

$79,388

$-

$10,000

$20,000

$30,000

$40,000

$50,000

$60,000

$70,000

$80,000

$90,000

Salem State of Oregon Oregon State Hospital in Salem

Salem Keizer School District

State Custodial Institutions in

Marion County

Willamette University

Salem Hospital

1050009000075000600004500030000

Median

Mean

65000625006000057500550005250050000


V ariance 391757342Skew ness -0.21477Kurtosis -1.74885N 100

M inimum 25502

A -Squared



49238

9.06

57093


48643 64453

95% C onfidence Interv al for S tDev

17378 22993

P-V alue < 0.005


9 5 % Confidence Inter vals

DISTRIBUTION CURVE OF ANNUAL WAGE AT WU

Figure 6: Distribution Curve of Annual Wages at Willamette University

Figure 5: Comparison of 2007 annual mean wages in Marion County

Figure 6: Distribution Curve of Annual Wages at Willamette University


14

1050009000075000600004500030000

Median

Mean

675006500062500600005750055000


V ariance 515102752Skewness 0.228719Kurtosis -0.721934N 100

Minimum 31242

A -Squared



55154

5.54

64161


62379 67246


19927 26365

P-V alue < 0.005



DISTRIBUTION CURVE OF ANNUAL WAGE AT SALEM HOSPTIAL

Figure 7: Distribution Curve of Annual Wages at Salem Hospital

10800096000840007200060000480003600024000

Median

Mean

525005200051500510005050050000


V ariance 14733026Skewness -0.711864Kurtosis 0.711284N 100

Minimum 43268

A -Squared



49922

14.03

51446


51987 52390


3370 4459

P-V alue < 0.005



DISTRIBUTION CURVE OF ANNUAL WAGE AT CORRECTION INSTITUTIONS

Figure 8: Distribution Curve of Annual Wages at State Custodial Institutions in Marion County

Figure 7: Distribution Curve of Annual Wages at Salem Hospital

Figure 8: Distribution Curve of Annual Wages at State Custodial Institutions in Marion County


15

raise the community’s average real wage. Offsetting that benefit somewhat, Salem Hospital and Willamette University also have the effect of increasing its variance. It is not evident that they induce very much in the way of additional development, either forward or backward through their supply chains. Most of their high value-added inputs are accessed outside of the area, aside from construction of their plants.

Next we will turn to indirect effects.

IncomePersonal income is a comprehensive measure of the income of all persons from all sources.

In addition to wages and salaries it includes employer-provided health insurance, dividends and

interest income, social security benefits, and other types of income. Personal income also includes

transfer payments from the government. Transfer payments include social security income, food

stamps, Medicare and Medicaid, welfare income, and student grants and loans received from the

government.21 When examining Marion County’s per capita income of $29,453, the county ranks

below the state ($33,299) and national averages ($36,714), but is in the top third among the state’s

36 counties (See Figure 9). The county’s five-year personal income growth rate of 3.61 percent

incrementally beats the state rate of 3.58 percent; both lag behind the national average of 4.47

percent (See Figure 10).

EmploymentThe Salem MSA, like elsewhere in Oregon, has steadily increased employment since the last

economic downtown in 2000-2001 (See Figure 11). For the 2007 year, the Oregon Employment Department reported the Salem MSA’s employment gained 2,800 jobs, or 1.9 percent, with the private sector responsible for 2,300 of those jobs. The fastest growth sector for new jobs was in construction employment with about 600 jobs; however, like the rest of the country, the industry has cooled since fall 2007.

Another strong performer, regional economist Pat O’Conner reported in the 2007 employment summary, was the professional and business services sector–which includes staffing agencies–grew 33 percent between 2001 and 2007, with the addition of 3,300 jobs.

Another growth area has been food manufacturing, which has increased jobs by 20 percent, or 900 jobs, between 2003 and 2007. The Salem MSA accounts for 19 percent of the state’s annual average agriculture employment with about 11,600 of the state’s 59,780 agriculture jobs.

Public-sector employment in the Salem MSA increased by 500 in 2007. However, public-sector employment has been fairly flat in recent years, according to the Employment Department.

21 Regional Economic Information System, Bureau of Economic Analysis, U.S. Department of Commerce


16

The agency reported that between 2001 and 2007 total government employment dropped 200 jobs. It should be noted that Oregon law constrains employee salaries to be no more than X percent of the biennial budget. The growth of the gambling industry can be seen in the 11.1 percent increase in Indian tribal employment. The Confederated Tribes of Grand Ronde operate the Spirit Mountain Casino in Polk County.

County 2002 2003 2004 2005 20061 Clackamas 35,316 35,973 37,631 39,116 41,378 2 Multnomah 34,049 34,362 35,656 36,602 38,529 * United States 30,821 31,504 33,123 34,757 36,714 3 Washington 31,690 32,140 33,069 34,515 36,259 4 Benton 30,811 32,896 34,373 33,814 35,722 5 Deschutes 28,122 28,952 30,421 31,909 33,522 * Oregon 28,931 29,565 30,621 31,599 33,299 6 Jackson 26,459 27,491 28,658 30,133 31,785 7 Yamhill 25,641 26,197 27,516 29,399 31,044 8 Lane 26,471 26,744 27,943 29,209 30,825 9 Lincoln 26,449 26,868 27,847 28,596 30,436

10 Columbia 27,211 27,444 27,967 28,997 30,174 11 Clatsop 26,027 27,167 27,178 28,155 29,571 12 Marion 25,553 26,661 27,462 27,994 29,453 13 Hood River 23,875 24,502 25,895 27,130 29,333 14 Curry 24,057 24,669 25,743 26,975 29,186 15 Tillamook 25,495 25,963 27,043 27,706 29,128 16 Grant 24,741 25,490 26,822 26,744 29,077 17 Douglas 24,751 25,038 26,028 26,824 28,198 18 Wallowa 24,237 24,291 26,413 26,645 28,112 19 Wasco 23,539 24,140 25,393 25,812 27,720 20 Polk 25,655 26,530 26,945 26,429 27,647 21 Morrow 22,062 24,945 27,012 25,278 27,537 22 Union 24,201 25,729 26,804 25,904 27,445 23 Coos 24,488 25,867 25,504 25,848 27,269 24 Linn 24,358 24,499 25,340 25,730 26,916 25 Klamath 23,487 24,501 24,837 25,414 26,908 26 Harney 22,529 23,880 23,833 25,233 26,358 27 Josephine 22,519 22,788 23,825 24,824 26,224 28 Lake 22,291 23,545 24,281 24,638 25,982 29 Wheeler 19,657 22,780 22,518 24,574 25,657 30 Umatilla 23,132 24,064 24,049 23,949 24,900 31 Baker 21,317 21,969 22,794 23,426 24,460 32 Crook 21,661 22,430 22,605 23,289 24,038 33 Gilliam 18,110 22,736 25,064 25,411 23,889 34 Jefferson 20,783 21,582 22,151 22,501 23,812 35 Malheur 18,698 19,830 19,965 19,943 21,137 36 Sherman 18,044 20,266 22,962 20,732 19,550

Source: Regional Economic Information System, Bureau of Economic Analysis, U.S. Department of Commerce

Per Capita Personal Income (ranked by 2006 income)Figure 9: Per Capita Personal Income (Ranked by 2006 Income)


17

0.00%

1.00%

2.00%

3.00%

4.00%

5.00%

6.00%

7.00%

8.00%

9.00%

Jan-

05

Feb-

05

Mar

-05

Apr

-05

May

-05

Jun-

05

Jul-0

5

Aug

-05

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-05

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-05

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Oregon Portland MSA Salem MSA

Figure 13: Unemployment for Oregon, the Portland MSA and Salem MSA between January 2005 and June 2008

$35,316

$41,378

$34,049

$38,529

$30,821

$36,714

$28,931

$33,299

$25,553

$29,453

$25,655

$27,647

$25,000

$30,000

$35,000

$40,000

$45,000

2002 2003 2004 2005 2006

ClackamasMultnomahUnited StatesOregonMarionPolk

3.14% Growth

4.04% Growth

4.47% Growth

3.58% Growth

3.61% Growth

1.89% Growth

Figure 10: Per Capita Personal Income 2002-2006 (with growth percentages)

Figure 11: Unemployment for Oregon, the Portland MSA and Salem MSA between January 2005 and June 2008


18

Location quotients (See Table 11) were used to compare the Salem MSA employment with Oregon’s overall employment numbers and the state’s other MSAs. The location quotients were calculated by taking the percentage of employment that a sector represents for a given region and dividing it by the percentage of employment the same sector represents in another economy. If the percentages of employment for a sector are the same for the two compared economies, then the location quotient will be 1.0. Location quotients more than 1.0 will indicate Salem has

Oregon % Salem MSA % LQ Bend MSA % LQ Corvallis MSA % LQ Eugene MSA % LQ Portland MSA % LQ Medford MSA % LQ

Total nonfarm employment 1,731,600 100% 152,200 100% 1.00 71,780 100% 1.00 38,560 100% 1.00 156,200 100% 1.00 1,036,900 100% 1.00 84,400 100% 1.0088.0%47009,111%38006,144,1etavirp latoT 63,550 89% 0.83 26,680 69% 1.06 127,000 81% 0.90 894,500 86% 0.85 72,630 86% 0.85

Natural resources and mining 9,300 1% 1,300 1% 1.59 8,300 12% 0.07 1,600 4% 0.21 1,000 1% 1.33 1,600 0% 5.54 660 1% 1.0901.1%7000,01%6009,301noitcurtsnoC 72.1%5001,8 65,700 6% 1.04 5,710 7% 0.9758.0%01002,51%21003,402gnirutcafunaM 5,670 8% 1.26 4,800 12% 0.80 19,800 13% 0.79 126,000 12% 0.82 7,290 9% 1.1665.0%5004,7%9000,151sdoog elbaruD 4,750 7% 0.73 4,410 11% 0.43 15,800 10% 0.48 95,800 9% 0.5396.1%5009,7%3003,35sdoog elbarudnoN 30.2%3000,4 30,300 3% 1.7837.2%4004,5%1005,22gnirutcafunam dooF 9,100 1% 4.04

Trade, transportation, and utilities 340,100 20% 25,700 17% 0.86 13,510 19% 0.90 4,290 11% 1.52 29,300 19% 0.90 206,600 20% 0.85 20,050 24% 0.7175.0%3000,4%5005,08edarT elaselohW 1,640 2% 1.15 76.0%4001,6 58,400 6% 0.47 2,600 3% 0.8520.1%21000,81%21000,102edart liateR 10,490 15% 0.81 39.0%31009,91 110,200 11% 1.11 14,640 17% 0.68

Transportation, warehousing, and utilities 58,700 3% 3,700 2% 0.72 1,370 2% 1.27 51.1%2003,3 38,000 4% 0.66 2,820 3% 0.7374.0%1005,1%2001,63noitamrofnI 1,710 2% 0.41 970 3% 0.39 3,900 2% 0.39 24,700 2% 0.41 1,680 2% 0.5008.0%5005,7%6006,601seitivitca laicnaniF 5,330 7% 0.66 1,530 4% 1.24 8,400 5% 0.92 71,500 7% 0.71 4,570 5% 0.91

Professional and business services 197,500 11% 13,200 9% 0.76 7,820 11% 0.80 3,470 9% 0.96 16,100 10% 0.84 136,300 13% 0.66 7,950 9% 0.92 Administrative and waste services 96,900 6% 7,200 5% 0.85 61,200 6% 0.80 Educational and health services 211,600 12% 19,600 13% 1.05 8,740 12% 1.06 5,180 13% 0.96 20,400 13% 0.99 127,500 12% 1.05 11,970 14% 0.91 Health care and social assistance 182,600 11% 16,700 11% 1.04 78.0%31048,4 19,000 12% 0.90 105,600 10% 1.08 11,280 13% 0.82

38.0%8005,21%01003,271ytilatipsoh dna erusieL 10,120 14% 0.58 3,620 9% 0.87 14,800 9% 0.87 97,800 9% 0.87 9,990 12% 0.69 Accommodation and food services 149,200 9% 11,100 7% 0.85 8,030 11% 0.65 09.0%8007,21 83,800 8% 0.90 8,300 10% 0.74

10.1%3003,5%3009,95secivres rehtO 2,350 3% 1.06 1,220 3% 1.10 5,200 3% 1.05 36,600 4% 0.99 2,760 3% 1.0685.1%62003,04%71000,092tnemnrevoG 8,240 11% 2.31 11,880 31% 0.86 29,100 19% 1.42 142,400 14% 1.93 11,780 14% 1.9026.0%1006,1%2002,92tnemnrevog laredeF 840 1% 0.90 590 2% 0.69 1,800 1% 0.91 18,000 2% 0.61 1,670 2% 0.5380.3%31002,02%4006,47tnemnrevog etatS 1,160 2% 8.21 8,540 22% 0.60 11,600 7% 1.79 21,000 2% 6.55 2,750 3% 4.0778.0%1001,2%2004,72noitacude etatS 60.0%12091,8 8,900 6% 0.24 7,400 1% 1.93 1,390 2% 0.8441.1%21006,81%11003,681tnemnrevog lacoL 6,230 9% 1.41 2,750 7% 1.71 15,800 10% 1.21 103,500 10% 1.22 7,360 9% 1.4077.2%1000,2%0002,8labirt naidnI 60.1%6001,9%6000,89noitacude lacoL 3,560 5% 1.21 1,470 4% 1.57 8,900 6% 1.05 57,700 6% 1.07 4,410 5% 1.14

Source: Oregon Employment Department

Oregon Nonfarm Average Annual Employment 2007 Location Quotient

Table 11: Location Quotients























Table 11: Per Capita Personal Income (Ranked by 2006 Income)


19

a comparative advantage; likewise anything less than 1.0 will indicate Salem has a comparative disadvantage in that particular employment sector. In Table 11, all of the reported Salem MSA employment sectors were listed and used in the analysis. Where there are blanks, the information was not available in reports provided by the Oregon Employment Department.

As indicated in Table 11, the Salem MSA has relatively more state government employment than the state overall, which would be still the case even if the employees of state correctional institutions were excluded, since they represent only one in five of the total. The Salem MSA has relatively more state employees than four of the state’s five other MSAs as well, although state government employment in the Corvallis MSA, at 22 percent, is a higher percentage than Salem MSA, at 13 percent. The Salem MSA also has higher location quotients for local government and local education compared to the others, which could indicate higher levels of need, perhaps induced by local custodial institutions. However, statistical analysis suggests that, outside of the Portland SMA, the main driver of social and K-12 services in Oregon is the size of the seasonally employed workforce, primarily agricultural and food-processing workers. Marion County’s agricultural and food-manufacturing workforce is the largest in the state.

Property Taxes One of the criticisms of the state custodial institutions in Marion County, and state and federal

property in general, is the absence of property tax revenue and the perceived lost property tax revenue the land would provide should it be used by some other commercial enterprise.

An examination of the fiscal year 2006-2007 property tax exemptions for Oregon’s counties, available on the Department of Revenue’s website, showed Marion County has 586 state property accounts with an estimated Real Market Value (RMV) of $1.2 billion. The county trails Multnomah’s 1,003 accounts and estimated RMV of $1.5 billion. Lane County is the only other county with a significant value of state property exemptions. The county has 885 accounts with an estimated RMV of $1.1 billion. After these three counties, the RMV of state property exemptions drops to $275 million for Clatsop County. The median RMV of state property exemptions is $55 million for the state’s 36 counties.

As a comparison, the median RMV of school district exemptions is $58 million for the state’s 36 counties. The median RMV of the federal property tax exemptions is $208 million for the state’s 36 counties. The RMV of each exemption for Marion County is $1 billion for school districts’ properties and $236 million for federal property.

Income TaxesA cursory look at the 2006 personal income tax statistics, available on the Oregon Department

of Revenue’s website, showed that Marion County ranked 5th in the state with total Adjusted Gross Income of $5.6 billion. The county also ranked 5th in the state with 6.7 percent of the state total


20

Adjusted Gross Income of about $83.8 billion. In both categories, Marion County followed, in order, Multnomah, Washington, Clackamas and Lane counties (see figure 12).

Marion County ranked 13th, however, when Adjusted Gross Income was measured per capita. In that measurement, Marion County had an AGI per capita of $18,329.

The county also ranked fifth in the number of filed tax returns with 120,128. The county dropped to 14th in the state with its average return of $46,791.

ServicesSchools

In our research, we collected and examined school district data from National Center for Education Statistics and from State Department of Education. With this data, we created a database spreadsheet on Oregon’s top 20 school districts based on student population. We further refined and added to school database looking for any irregularities associated with the Salem-Keizer School District (SKSD). In this first pass, it was seen that the SKSD had an unusually high percentage of students receiving free or reduced lunches, one measure of poverty in a community and a potential way to measure the burden impact of our hypothesis.

A student may qualify for the free or reduced-lunch programs if his or her family income is below a certain federal level. For a family of four, the household income must be below $2,238 per month to qualify for the free-meal program, and under $3,184 for the reduced-meal program. A student may also

Baker 243,888 16,470 0.45% 14,808.02 0.29% 6,301 243,888 38706.26Benton 1,987,235 84,125 2.28% 23,622.41 2.40% 32,875 1,987,235 60448.21Clackamas 10,920,781 367,040 9.95% 29,753.65 13.18% 157,072 10,920,781 69527.23Clatsop 671,846 37,045 1.00% 18,135.94 0.81% 14,931 671,846 44996.72Columbia 1,012,888 46,965 1.27% 21,566.88 1.22% 19,807 1,012,888 51137.9Coos 1,018,786 62,905 1.70% 16,195.63 1.23% 24,995 1,018,786 40759.6Crook 436,307 24,525 0.66% 17,790.28 0.53% 8,500 436,307 51330.19Curry 388,469 21,365 0.58% 18,182.50 0.47% 9,311 388,469 41721.52Deschutes 3,875,534 152,615 4.14% 25,394.19 4.68% 64,508 3,875,534 60078.35Douglas 1,780,797 103,815 2.81% 17,153.56 2.15% 42,488 1,780,797 41912.93Gilliam 29,671 1,885 0.05% 15,740.84 0.04% 793 29,671 37416.75Grant 119,135 7,630 0.21% 15,613.98 0.14% 2,971 119,135 40099.17Harney 90,623 7,670 0.21% 11,815.28 0.11% 2,844 90,623 31864.69Hood River 419,681 21,335 0.58% 19,671.03 0.51% 8,964 419,681 46818.55Jackson 4,094,372 198,615 5.38% 20,614.62 4.94% 82,810 4,094,372 49442.97Jefferson 340,853 21,410 0.58% 15,920.27 0.41% 8,583 340,853 39712.58Josephine 1,311,682 81,125 2.20% 16,168.66 1.58% 32,179 1,311,682 40762.06Klamath 1,075,794 65,455 1.77% 16,435.63 1.30% 25,417 1,075,794 42325.78Lake 102,435 7,540 0.20% 13,585.54 0.12% 2,946 102,435 34770.86Lane 7,061,752 339,740 9.21% 20,785.75 8.52% 141,455 7,061,752 49922.25Lincoln 861,682 44,520 1.21% 19,354.94 1.04% 18,938 861,682 45500.15Linn 1,974,900 108,250 2.93% 18,243.88 2.38% 44,843 1,974,900 44040.33Malheur 343,372 31,725 0.86% 10,823.40 0.41% 9,641 343,372 35615.85Marion 5,620,934 306,665 8.31% 18,329.23 6.78% 120,128 5,620,934 46791.21Morrow 147,778 12,125 0.33% 12,187.86 0.18% 3,890 147,778 37989.14Multnomah 17,201,312 701,545 19.01% 24,519.19 20.76% 300,785 17,201,312 57188.06Polk 1,422,540 66,670 1.81% 21,337.04 1.72% 28,299 1,422,540 50268.22Sherman 29,065 1,865 0.05% 15,584.54 0.04% 751 29,065 38701.95Tillamook 463,555 25,530 0.69% 18,157.28 0.56% 10,750 463,555 43121.43Umatilla 1,069,426 72,190 1.96% 14,814.05 1.29% 26,649 1,069,426 40130.07Union 431,613 25,110 0.68% 17,188.89 0.52% 10,372 431,613 41613.28Wallowa 118,226 7,140 0.19% 16,558.24 0.14% 3,138 118,226 37675.53Wasco 399,983 24,070 0.65% 16,617.50 0.48% 9,489 399,983 42152.3Washington 13,760,865 500,585 13.56% 27,489.57 16.61% 210,784 13,760,865 65284.2Wheeler 20,460 1,565 0.04% 13,073.80 0.02% 538 20,460 38030.66Yamhill 2,016,751 91,675 2.48% 21,998.92 2.43% 36,911 2,016,751 54638.21

Total %001505,096,3499,468,28 22,453.57 100% 1,525,656 82,864,994 45,347 Oregon Department of Revenue2006 Personal Income Tax Statistics

Number of Returns Adjusted Gross IncomeAverage Return

2006 Adjusted Gross Personal Income (Oregon Counties)

CountyAdjusted Gross Income (in

thousands)2006 Population AGI per capita

AGI as a percentage of State

2006 Population as % of State

Figure 12: 2006 Adjusted Gross Personal Income (Oregon Counties)


21

qualify if his/her family is receiving food stamps, temporary assistance for needy families (TANF), or benefits from the food Distribution Program on Indian Reservations (FDPIR).

To further investigate the Salem-Keizer School District’s percentage of students eligible for free and reduced lunch, we identified the counties in which top districts were located based on student enrollments. We then collected data on all school districts located within these counties:

10-YEAR TREND IN STUDENT ENROLLMENT IN 10 OREGON COUNTIES TOP 10 COUNTIES 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

MULTNOMAH 87,660 93,171 93,274 93,296 94,187 93,975 91,374 91,232 91,653 91,391 91,835

WASHINGTON 67,345 69,328 71,141 73,195 75,534 77,061 77,129 78,951 80,572 82,776 83,602

CLACKAMAS 53,856 54,055 54,412 54,691 55,502 56,202 56,662 57,157 57,915 58,612 58,950

MARION 49,909 50,522 51,232 52,271 53,671 54,842 55,747 55,874 56,899 58,304 59,144

LANE 49,208 49,093 48,524 48,144 48,113 48,176 47,783 47,560 47,709 47,178 47,464

JACKSON 28,468 28,814 29,201 29,188 29,406 29,515 29,253 28,950 29,057 29,114 28,901

DESCHUTES 18,125 18,983 19,603 9,867 20,508 20,914 21,342 22,044 22,668 23,652 24,421

LINN 18,129 17,864 17,958 17,798 17,807 17,941 18,037 18,121 19,163 20,113 20,561

DOUGLAS 17,685 17,227 16,881 16,646 16,606 16,525 16,250 15,963 16,132 15,645 15,565

BENTON 10,315 10,223 9,946 9,996 9,820 9,754 9,496 9,300 9,229 9,103 9,064

Table 12: Student Enrollment for the entire county for the 10 counties with the largest school districts. Table 12:Student enrollment for the entire county for the 10 counties with the largest school districts

8 YEAR TREND IN FREE & REDUCED LUNCH ELIGIBLE TOP 10 COUNTIES 1999 2000 2001 2002 2003 2004 2005 2006 2007

MULTNOMAH 34,571 34,555 38,236 39,548 40,511 44,996 43,986 43,797 43,676

WASHINGTON 15,153 15,886 18,699 20,562 23,230 23,733 25,084 26,202 27,234

CLACKAMAS 10,880 11,063 11,650 12,914 14,664 15,468 16,089 15,531 16,181

MARION 22,322 22,468 23,946 26,528 27,045 27,313 28,167 29,276 30,069

LANE 15,939 15,664 16,864 17,785 18,625 19,518 19,141 19,040 19,410

JACKSON 10,822 10,028 11,178 11,213 11,881 11,980 12,010 11,814 12,108

DESCHUTES 5,482 5,834 6,773 6,892 7,541 7,666

7,641

7,626 8,114

LINN 6,613 6,527 6,761 7,709 8,180 8,593

8,489

8,937 8,308

DOUGLAS 7,470 7,299 7,012 7,517 7,960 7,471

7,786

7,130 7,243

BENTON 2,332 2,038 2,289 2,366 2,611 2,565

2,602

2,659 2,639

Table 13: 21 Number of students eligible for free and reduced lunch in target 10 counties between 1999 and 2007.

Table 13: Number of students eligible for free and reduced lunch in target 10 counties between 1999 and 2007

Marion County•

Deschutes County•

Douglas County•

Jackson County•

Benton County•

Lane County•

Linn County•

Clackamas County•

Multnomah County •

Washington County•


22

The districts in Marion County – including the Salem-Keizer School District, which is the state’s third largest district – have a disproportionately high number of students eligible for food aid. Again, however, our analysis suggests that this is due primarily to high levels of seasonal employment in the area, especially among agricultural and food-processing workers, rather than to the families of inmates.

The Salem-Keizer School District does not track the occupations of its students’ parents or guardians. However, the district reported it had 1,493 migrant students during the 2007/2008 school year. Migrant students – children of migratory workers who relocate across school district boundaries in order to obtain seasonal or temporary employment in agriculture or fishing – in the

United States typically follow one of three geographic migratory streams (East Coast, Midwest, and West Coast). The primary residence areas for all three streams are economically disadvantaged areas. Most migrant farm workers in the West Coast stream use southern California as a home base. These workers follow crops north through Idaho, Oregon, and Washington.

Ron Hays, executive director of the Marion Polk Food Share, reported that 44 percent of the people getting emergency food boxes are children (higher than the state average). He said the food share has mapped poverty areas by census tracts combined with information on free and reduced lunch eligibility. What they found was:

45-56 percent of children living in the Salem-Keizer area are living under the federal •poverty level.

Compared to other counties with a population of over 100,000, Marion County is the only •county with free and reduced-lunch rates of over 50 percent.

PERCENTAGE OF FREE & REDUCED LUNCH ELIGIBLE PER POPULATION OF STUDENT FROM 1999 TO 2007 TOP 10

COUNTIES 1999 2000 2001 2002 2003 2004 2005 2006 2007

MULTNOMAH 37.06% 37.04% 40.60% 42.08% 44.34% 49.32% 48.00% 47.95% 47.57%

WASHINGTON 21.30% 21.70% 24.76% 26.68% 30.12% 30.06% 31.14% 31.66% 32.59%

CLACKAMAS 20.00% 20.23% 20.99% 22.98% 25.88% 27.06% 27.79% 26.62% 27.47%

MARION 43.57% 42.98% 44.62% 48.37% 48.51% 48.88% 49.50% 50.21% 50.84%

LANE 32.85% 32.54% 35.05% 36.92% 38.98% 41.04% 40.36% 40.58% 40.97%

JACKSON 37.06% 34.36% 38.01% 37.99% 40.61% 41.38% 41.33% 40.58% 41.89%

DESCHUTES 27.97% 29.37% 33.03% 32.95% 35.33% 34.78% 33.71% 32.24% 33.23%

LINN 36.82% 36.67% 37.97% 42.97% 45.35% 47.42% 44.30% 44.70% 40.41%

DOUGLAS 44.25% 43.85% 42.23% 45.49% 48.98% 46.80% 48.26% 45.57% 46.53%

BENTON 23.45% 20.39% 23.31% 24.26% 27.50% 27.58% 28.19% 29.21% 29.12%

Table 14: The number of students eligible for free and reduced lunches as a percentage of student enrollment in each of the target counties. Table 14: Percentage of free and reduced lunch eligible per population of students from 1999 to 2007


23

When examining the actual numbers of children eligible for free and reduced-lunches, •Marion County numbers add up to almost all of the other red counties, where 50-70 percent of children are eligible, combined.

Within Marion County, half of the school districts have at least 50 percent of their student •population eligible for free and reduced lunches.

In 2006-2007, 29,276 children in Marion County received free and reduced lunches. It is •believed high school students are undercounted due to stigma associated with receiving the benefits; also the number doesn’t include preschoolers and children still at home.Out of these 29,276 students, 84 percent received free lunch.•

55.2%31.9%

3.0%

1.6%

1.1%

3.8% 3.5%White

Black

Hispanic

Asian

Indian

Multi

Unknown

Figure 13: Percentage or race demographics in Marion County’s School Districts (combined)

Table 15: Marion County students who are eligible for free and reduced lunch.

TNECREP 7002 RAEY ELBIGILE HCNUL DECUDER & EERFTOTAL STUDENT 59,144 N/A TOTAL FREE & REDUCED LUNCH ELIGIBLE 30,069 50.8%

%3.24 040,52 ELBIGILE HCNUL EERF %5.8 920,5 ELBIGILE HCNUL DECUDER

Figure 15: Marion County students who are eligible for free and reduced lunch as a percentage.

16.7%

83.3%

Free LunchEligible

ReducedLunch Eligible

Table 15: Marion County students who are eligible for free and reduced lunch

Figure 14: Marion County students who are eligible for free and reduced lunch as a percentage


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Prison FamiliesOne of the popular beliefs associated with this topic is that families of those incarcerated

will move nearby the state prison to be closer to their loved ones. One reason for such a move, it is assumed, is that the families would then be closer for visitation purposes. While it may be a common belief, there is no documented evidence to support or refute it. The Department of Corrections reports that the agency does not track such information.

Anecdotal evidence, on the other hand, suggests families do not relocate to be closer to their incarcerated loved ones. On the internet website Prison Talk, a question was posted several months ago asking the Oregon forum members to describe their relationship to someone incarcerated and other demographics. Of the 11 people that replied, all reported living outside the county of where their loved one was incarcerated. In a separate question, posted as part of this research, members reported not knowing of anyone specifically who had relocated to be closer to their incarcerated loved ones. “I have heard of families NOT moving to be closer because the DOC moves inmates around to various institutions based upon programming, change of security level, etc. One could move and then just have to move again,” wrote one woman, whose husband is in prison. “For people with jobs and children, it often is better for them to stay in one place as the parent at home is the only wage earner once the other parent is incarcerated. Changing schools for children is also a consideration. Housing shortages or cost of housing in certain places is also a consideration.”

Other evidence that families do not follow their loved ones to prison comes from a Department of Corrections inmate survey that was taken in 2000. In the survey, a random sample of 2,500 male inmates and the entire female inmate population (528) were surveyed. There were 1,382 male respondents (55.3%) and 356 female respondents (67.4%) to the survey, according to the report. Among the survey’s findings was that 67 percent of the women and 58 percent of the men who are Oregon prison inmates were parents. If those percentages hold true today then about 723 current women inmates and 7,268 current male inmates have children.

The Department of Corrections inmate survey found each parent inmate had an average of 2.5 children between the ages of 0-17, which resulted in 2000 with about 15,000 children having a parent serving at least a one-year prison sentence. Most fathers (54 percent) and mothers (65 percent) were living with their children when they were arrested and later incarcerated. These estimates do not extend to inmates serving time in county jails or other institutions. The survey also found a majority of those parents have little or no contact with their children. For example, for each father who averages one child visit per month there are another nine inmate fathers who have not visited with their children in the last three months. The survey was conducted over a period that included the Thanksgiving and Christmas holidays, which would be a time when more visitations would be expected. When the father is arrested and later jailed, the children are likely to live with the non-incarcerated parent (81 percent). Another 14 percent of the children will live with a


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relative when the father is incarcerated. The remaining five percent of children are placed in foster care. Another survey result that anecdotally suggests families don’t relocate near prisons to be closer to an incarcerated loved one is that less than 10 percent of the incarcerated fathers average one visit per month, regardless of the child’s caretaker. If the premise is that families relocate near prison to be closer for visitation, then the findings (lack of visitations) suggest this doesn’t occur when more than 90 percent of the incarcerated parents are fathers, and only one in five had a visit with their child in the last three months.

The biggest reason (about 38 percent) given for this lack of visitation is the distance between the children’s residence and the prison where their fathers are incarcerated. The second biggest reason (about 17 percent) reported that a lack of transportation was a factor restricting visitation between children and their incarcerated parents.

All this said, if the survey’s reported findings held true to individual prisons, then about 2,171 current male inmates (of 3,743 total) in the four state prisons located in Marion County have children. Of those, an estimated 10 percent, or 217 inmates, have children located close enough for regular monthly visits. Those 217 inmates are each expected to have about 2.5 children between the ages of 0-17. That would result in about 542 children living in Marion County with a father incarcerated in one of the four state prisons located in the county (the state has only one women’s prison, which is located outside the county).

Marion County and Salem likely have more children among their populations with at least one parent incarcerated in a state prison outside the county than inside.

Law Enforcement & CrimeThe presence of four state prisons in Salem and Marion County may have inspired the nickname

“Felony Flats” for the residential neighborhood area around them, but a look at reported crime statistics kept by the FBI and Oregon State Police show that it is safer to live in Salem and Marion County as major crimes have steadily dropped over the last 5-10 years.

Year Population Violent crime

Murder and nonnegligent manslaughter

Forcible rape Robbery Aggravated

assaultProperty

crime Burglary Larceny-theft

Motorvehicle

theftArson

1997 121,280 391 1 86 190 114 11,043 1,350 8,771 864 581998 126,365 393 11 64 172 146 10,245 1,395 8,073 722 551999 128,022 287 2 83 144 58 9,378 1,293 7,414 637 342000 133,765 337 5 74 177 81 9,667 1,259 7,629 758 212001 138,984 333 4 81 160 88 10,814 1,395 8,515 877 272002 140,931 344 6 79 156 103 12,068 1,415 9,277 1,353 232003 142,501 514 5 75 180 254 11,563 1,575 8,417 1,571 422004 144,319 745 4 61 141 539 9,940 1,400 7,420 1,120 432005 148,009 706 3 53 134 516 9,004 1,170 6,752 1,082 322006 151,190 691 9 74 129 479 8,267 1,073 6,363 831 542007 154,484 583 3 58 132 390 7,434 915 5,627 892 30

Source: FBI

Table 16: City of Salem Crime Statistics


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Law enforcement agencies annually report to the FBI their major crime statistics, which include the felony crimes such as murder, rape, robbery, aggravated assaults, burglary, auto theft and arson. Police forward the annual results to the FBI to help calculate national crime rates. They also use the data to help spot trends and target enforcement efforts.

Those major crimes dropped 26 percent in Marion County between 2002 and 2006. The county’s crime rate per 1,000 residents also dropped from 71 crimes per 1,000 residents in 2002 to 50 crimes per 1,000 residents. Those crime rates, however, are among the highest in the state with only Linn (55 per 1,000), Lincoln (60 per 1,000) and Multnomah (61 per 1,000) Counties having higher crime rates per 1,000 residents.

In Salem, major crimes have dropped 29 percent overall between 1997 and 2007. The per capita rate for major crimes dropped 45 percent in the same period for a rate of 52 crimes per 1,000 residents. Violent crime – which includes murder, rape, aggravated assault, and robbery – increased 49 percent during the period. While that is a jump, it results in per capita increase from 3 violent crimes per 1,000 residents to four violent crimes per 1,000 residents.

94

75

88

52

91

72

86

48

3 25 4

0

10

20

30

40

50

60

70

80

90

100

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007

Part 1 Crime Trend Per 1,000 Salem Residents

Total Part 1 Crimes Per Cap Property Crime Per Cap Violent Crime Per Cap

Figure 17: Crime Trend Per 1,000 Salem Residents


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The apparent success in fighting crime is evident in the number of people from Marion County who are sent to a state prison upon their criminal convictions. According to the Department of Corrections, Marion County led the state in prison admissions per capita with 2.33 inmates admitted per 1,000 residents during the year July 2006 through July 2007, the latest information available. The county was second in prison admissions per capita in 2005-2006 and first in 2004-2005 (see table 18). The Department of Corrections had no reason for the county’s leading role in prison admissions, but a Marion County Sheriff’s supervisor attributed it to aggressive law enforcement and a proactive district attorney’s office.

In a 15-year review between 1991 and 2005 of the sworn police officers in 10 Oregon counties (selected because they also contain the largest school districts), Marion County placed in the top half of the selected counties with total officers per 1,000 residents. Marion County had an average of 1.68 officers. Multnomah had the highest ratio with 2.01 officers – which include sworn police officers, sheriff’s deputies and state police officers – per 1,000 residents. Douglas and Deschutes

2002 Population 2006 Population 2002 2003 2004 2005 2006 5-year Rate 2002 Per Capita 2006 Per CapitaBAKER 16,700 16,470 532 500 500 368 295 -45% 31.9 17.9BENTON 79,900 84,125 2945 3179 3179 3579 3342 13% 36.9 39.7CLACKAMAS 350,850 367,040 14407 14790 14790 13509 11471 -20% 41.1 31.3CLATSOP 36,100 37,045 1759 1689 1689 1747 1474 -16% 48.7 39.8COLUMBIA 44,600 46,965 1174 1229 1229 826 807 -31% 26.3 17.2COOS 62,650 62,905 2028 1780 1780 1987 1736 -14% 32.4 27.6CROOK 20,200 24,525 711 871 871 723 559 -21% 35.2 22.8CURRY 21,250 21,365 421 483 483 437 507 20% 19.8 23.7DESCHUTES 126,500 152,615 5743 6242 6242 6401 5731 0% 45.4 37.6DOUGLAS 101,300 103,815 3359 3610 3610 3865 3916 17% 33.2 37.7GILLIAM 1,900 1,885 25 33 33 34 34 36% 13.2 18.0GRANT 7,750 7,630 151 143 143 128 126 -17% 19.5 16.5HARNEY 7,600 7,670 116 142 142 139 154 33% 15.3 20.1HOOD RIVER 20,450 21,335 466 480 480 463 539 16% 22.8 25.3JACKSON 187,600 198,615 9054 8991 8991 9382 7947 -12% 48.3 40.0JEFFERSON 19,850 21,410 606 661 661 648 615 1% 30.5 28.7JOSEPHINE 77,650 81,125 2511 3237 3237 3055 2866 14% 32.3 35.3KLAMATH 64,550 65,455 1964 2157 2157 2264 1949 -1% 30.4 29.8LAKE 7,450 7,540 95 230 230 180 176 85% 12.8 23.3LANE 328,150 339,740 17307 17615 17615 19662 16625 -4% 52.7 48.9LINCOLN 44,700 44,520 2211 2769 2769 2897 2681 21% 49.5 60.2LINN 104,000 108,250 5518 7468 7468 6783 6013 9% 53.1 55.5MALHEUR 32,000 31,725 1146 1035 1035 1179 995 -13% 35.8 31.4MARION 291,000 306,665 20669 16843 16843 17566 15359 -26% 71.0 50.1MORROW 11,250 12,125 470 414 414 338 469 0% 41.8 38.7MULTNOMAH 670,250 701,545 52456 54976 54976 50423 43354 -17% 78.3 61.8POLK 63,450 66,670 2566 2992 2992 3227 2933 14% 40.4 44.0SHERMAN 1,850 1,865 43 37 37 43 42 -2% 23.2 22.5TILLAMOOK 24,600 25,530 846 998 998 1017 853 1% 34.4 33.4UMATILLA 71,000 72,190 2562 2475 2475 3339 3563 39% 36.1 49.4UNION 24,600 25,110 562 759 759 590 672 20% 22.8 26.8WALLOWA 7,150 7,140 117 89 89 127 100 -15% 16.4 14.0WASCO 23,750 24,070 1043 1140 1140 1057 870 -17% 43.9 36.1WASHINGTON 463,050 500,585 18284 17899 17899 16682 13862 -24% 39.5 27.7WHEELER 1,550 1,565 23 29 29 18 24 4% 14.8 15.3YAMHILL 87,500 91,675 2870 3831 3831 3601 3295 15% 32.8 35.9Source: Oregon Criminal Justice Commission

FIVE-YEAR PROFILE OF TOTAL CRIMES FOR OREGON'S COUNTIES

Table 17: Five-year profile of total crimes for Oregon’s Counties


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counties also ranked higher than Marion County. When just reviewing sworn police officers, Marion County ranked second behind Multnomah County with .97 officers per 1,000 residents. The statistics may be misleading because of the inclusion of state patrol officers. Marion County has a ratio of .43 state patrol officers per 1,000 residents. Deschutes County’s .32 officers per 1,000 ranks second.

County Prison Admits County pop Rate Per 10001 Marion 750 298,450 2.512 Harney 18 7,650 2.353 Lake 16 7,500 2.134 Linn 224 106,350 2.115 Malheur 60 31,850 1.886 Klamath 122 64,800 1.887 Josephine 137 78,600 1.748 Jefferson 35 20,250 1.739 Lincoln 73 44,400 1.64

10 Columbia 71 45,650 1.56

1 County Prison Admits County pop Rate Per 10002 Lincoln 106 44,405 2.393 Marion 702 302,135 2.324 Jefferson 44 20,600 2.145 Sherman 4 1,880 2.136 Malheur 63 31,800 1.987 Linn 204 107,150 1.908 Lake 14 7,505 1.879 Harney 14 7,660 1.83

10 Clatsop 66 36,640 1.80

1 County Prison Admits County pop Rate Per 10002 Marion 714 306,665 2.333 Linn 217 108,250 2.004 Malheur 58 31,725 1.835 Harney 13 7,670 1.696 Multnomah 1,158 701,545 1.657 Lincoln 70 44,520 1.578 Klamath 102 65,455 1.569 Lane 522 339,740 1.54

10 Baker 24 16,470 1.46

Source: Oregon Department of Corrections

July 2004- June 2005



Prison Admissions by County (Top 10)Table 18: Prison Admissions by County (Top10)


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Marion County’s ratio may be influenced by the state patrol’s training academy and headquarters being located in Marion County and staffed with sworn officers who no longer regularly participate in patrols.

The state’s Administrative Rule 255-070-0003 requires post prison inmates to be released to their county of residence as determined where a last arrest led to their conviction. There are some exceptions to the rule, but those are approved or denied by the corrections department and the local agencies responsible for post-prison supervision, typically the county sheriff’s office. This is important to note because it suggests that any undue burdens associated with ex-cons would be associated with those criminals convicted in Marion County and not just those housed in the county’s state prisons.

Those inmates released out of prison typically are required to have some form of post-prison supervision. The Marion County Sheriff’s Office administers post-prison supervision in the county. The office oversees about 4,400 offenders and has another 1,600 offenders who have failed to check in with their post-prison supervision officers and likely have left the area. The sheriff’s office reports a caseload per officer of about 80 offenders. The national standard is 60 offenders per officer. The Oregon standard also is 60 offenders per officer, but the Marion County Sheriff’s Office said the standard was goal and the general practice ranged between 60 and 90 offenders per officer. The Marion County Sheriff’s Office reported it is the second-busiest community supervision office in the state, behind Multnomah County. The Department of Corrections and Marion County Sheriff’s Office both reported that about 25 percent of those released from prison will return to prison or jail within three years. The Marion County Sheriff’s Office also reported about 700 prison inmates are released back into Marion County annually.

CensusHousing about 4,500 people in state’s custodial institutions in Marion County has one

unexpected economic spillover – the inmates count toward the county’s population by the federal census that results, by one estimate, in an additional $13.5 million to the Marion County economy. The U.S. census is taken every 10 years with subsequent annual estimates, all of which provide the basis for allocating billions in federal and state dollars. Oregon expects to receive $9.3 billion in federal dollars during the 2007-2009 biennium.22

The census was constitutionally required for apportionment of seats in the U.S. House of Representatives among the states. According to Tom Gillaspy, Minnesota’s state demographer, the census began to be used after the War of 1812 to define the need for government programs, such as war veteran assistance. Now, the census figures are used in determining funding for such programs as transportation, corrections, police and public safety, public health, anti-poverty and housing among others.

22 According to the Oregon Department of Revenue in a July 11, 2008 e-mail response to posed question.


30

According to the U.S. Census guidelines, people staying in wards for the mentally ill and inmates of correctional institutions, including prisons, jails, detention centers, or halfway houses are counted at the institution where they reside.23 Gillaspy estimates about $3,000 in federal money goes to any given community each decade per person counted in the 2000 U.S. census. “But the total impact is larger,” Gillaspy said in an e-mail. “Since some of the programs are complex, it is not always possible to estimate the effect as an average – it is different for different areas and circumstances. But the numbers we used were to give some sense of the relative magnitude and importance of the census. The dollar impact is larger now.”

At $3,000 per person, that equates to about $13.5 million for the 4,500 inmates and patients located in Marion County’s custodial institutions.

Prison IndustriesIn 1994, Oregon voters passed Ballot Measure 17, the Prison Reform and Inmate Work Act, that

required all inmates to work or be engaged in a combination of work and workforce development activities 40 hours per week. One of the results of the measure was the creation of the Oregon Corrections Enterprises, or OCE, which operate a range of businesses in eight of the state’s 14 prisons. About 1,140 incarcerated Oregon inmates worked more than 1.6 million hours in 2007 in various OCE programs.

In Marion County, those inmates created park equipment, boat docks, and cabins for the state parks; they answered phones for call centers; they provided GIS data and mapping services; they operated a print shop and media design group; and they built dormitory beds and storage furnishings for the University of Oregon and other clients among other services.

Inmates contribute part of their earnings toward meeting their obligations for child support, state and federal taxes, court-imposed fines, and victim assistance as applicable. Many inmates also contribute to the support and welfare of their families by sending home a portion of their earnings. According to the Oregon Correctional Enterprises 2007 Annual Report, the state’s prison industry also created 100 non-prison jobs (marketing and sales, shop supervisors, administrative and others) that received $8.1 million in salary and benefits in the last fiscal year, or about $81,000 per employee. Of that, 51 of the positions, or 51 percent, were located in Marion County, either at the administrative offices or at three of the four prisons in the county.

Scott and Derrick have previously concluded that employment of 100 prison laborers crowds out between 13 and 20 unskilled private sector jobs nationally.24 However, they go on to say, local labor is not displaced if the goods and services produced would have been produced out-of-county otherwise.

23 http://www.census.gov/population/www/censusdata/resid_rules.html24 Scott, C. and Derrick, F. 2006. Prison Labor: The Local Effects of Ohio Prison Industries. International Advances in Economic Research 12:540-550


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The various OCE businesses also provide, for free, various services supporting community events and charitable organizations. This past year, the agency reports, those organizations in Marion County included:

• Cascade High School• Marion County Juvenile Services• Marion County• Salem Area Youth Golf Foundation• Santiam Water Control District• Children’s Justice Alliance• Sprague High School Band• Governor’s Food Drive• Schirle Elementary School

AlternativesAmong other uses for the state hospital could include examples found elsewhere, such as

2,400 residences that were built on the old Dammasch State Hospital grounds in Wilsonville; or in Massachusetts, the former Danvers State Hospital was sold for $19 million to a developer now building a new neighborhood including 433 luxury apartments and 64 condos.25

However, private businesses would face the same hurdles as the state in rebuilding at the site. Previous consultant reports have identified the likelihood that one or more of the buildings at the Oregon State Hospital site are designated as historical or are considered potentially historical. The buildings in these classifications should be considered a design constraint that could prevent or delay the entire site from being used for development of a new hospital or other use. It is expected that the state will incorporate these buildings in memorial to those individuals who died over the years at the hospital. Such a use would not likely thematically fit with another use for the land. Also, an estimated two-thirds of the project area was identified to be a High Probability Area for both prehistoric and historic-period archeological resources requiring detailed surveying and possible mitigation

ConclusionThere were, are and will be multiple stories to be told about the groups who have inhabited

Marion County and Salem – from the Kalapuyans and Methodist missionaries to today’s diverse community. Included in this shared history are the stories of the Oregon State Penitentiary and the Oregon State Hospital, both of which have been part of the community more than 100 years. The three other state prisons also have decades-old histories in the county, as do the juvenile detention centers. While housing these institutions lack panache, they have contributed positively to the local economy through a highly paid workforce; periodic capital projects, such as the current $250

25 “Group wants Oregon State Hospital on historic register” Statesman Journal. Sept. 17, 2007


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million state hospital project; and through their longevity in the community.We concluded that these subject custodial institutions and their attendant populations place

no undue burden on the services provided by local and county governments. From an economic standpoint, the effect of the local custodial institutions is almost positive. We concluded these custodial institutions have few economic spillovers and those that exist are either not significant or perceived as significant.

To again quote Salem Mayor Janet Taylor, “Good jobs mean people buy houses; they spend money in stores. All of that keeps property taxes not only stable, but growing.”26 Taylor’s comments were not about the subject institutions, but about a newly announced solar-cell manufacturing plant to be built over the next two years. The facility is expected, for a minimum of five years, to employ 200 people and maintain an average salary and benefit package of $50,000 per worker. The plant’s owner will be eligible to receive about $40 million in state tax credits on the $80 million project. In addition to the credits, the company was expected to receive “discounted land, road improvements worth $1 million, worker training, a Marion County grant for equipment and a five-year exemption on property taxes for its plant and machinery. The company can also apply for federal tax credits, which Congress appears poised to renew.”27

This business example is used to highlight the present value of more than 1,100 prison employees, who earn an average salary more than $50,000 not including benefits. In addition, the Oregon State Hospital has more than 1,200 employees whose combined average salary and benefits are $69,000.

If law enforcement, schools and hospitals are experiencing an increased demand for their services, that demand is not explained by the inmates and mental patients housed in the state institutions located in the county. Oregon law restricts where inmates live following their incarceration. And it is very unlikely, based on inmate surveys and interviews, that families follow their loved ones to the county of incarceration.

One possible explanation of what may be driving increased economic and social service demands may be the county’s fairly large migrant workforce. An additional explanation may be an emphasis over the last 10 years by law enforcement and prosecutors to crack down on crimes and criminals in Salem and Marion County, particularly those connected to the methamphetamine

crisis that has swept the nation since the late 1990s.

26 Michael Rose, “City Aims to Become hub in Green Jobs.” Salem Statesman Journal. Sept. 28, 200827 Richard Read, “Tax incentives, other goodies help lure Sanyo to Oregon.” The Oregonian. Sept. 26, 2008


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BIBLIOGRAPHYTraining on the Inside to Work on the Outside: Oregon Correctional Enterprises 2007 1. Annual Report. Oregon Department of Corrections.July 15, 2008 e-mail response, answering several questions, from Lindsay Cusworth, public 2. affairs officer for the Department of Corrections.Executive Summary of Children of Incarcerated Parents Survey. DOC3. Children of Incarcerated Parents Survey and related documents. DOC4. March 17, 2008 Memorandum regarding Hewlett Grant Proposal and description of project 5. scope.Scott, C. and Derrick, F. 2006. Prison Labor: The Local Effects of Ohio Prison Industries. 6. International Advances in Economic Research 12:540-550.Farrigan, T. et al. The Economic Impacts of the Prison Development Boom on Persistently 7. Poor Rural Places.Being a Good Neighbor: The Economic Impact of Rush City Prison. Minnesota Employment 8. Review. November 2000.Jacklet, Ben. Prison Town Myth: The Promise of Prosperity Hasn’t Come True For Oregon’s 9. Rural Communities. Oregon Business Magazine. May 2008, P30-35.Setti, Christopher. Prisons and Their Effects on Local Economies: The Colorado Experience. 10. University of Colorado. December 2001.Clement, Douglas. Big House on the Prairie: Despite protests by some, small-town leaders 11. have sought out prisons as economic saviors. Both the critic’s deepest fears and the boosters’ highest hopes are likely to go unfulfilled. FedGazette; Federal Bank of Minneapolis. January 2002.King, Ryan S.; Mauer, Marc; Huling, Tracy. Big Prison, Small Towns: Prison Economics 12. in Rural America. Sentencing Project. February 2003.Turner, Robert C.; Thayer, David. Yes in My Backyard! Why do Rural Communities Use 13. Prison Based Economic Development Strategies? Skidmore College.


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LIST OF GRAPHICS

Table 1: Population Estimate for Marion County and its Incorporated Cities ....................................................... 4Table 2: Total Gross Domestic Product (in millions) .............................................................................................. 4Table 3: State Custodial Institutions in Marion County .......................................................................................... 5Table 4: Site Evaluation Rankings ........................................................................................................................... 8Table 5: Top occupations by number of employees in Salem Metropolitan Service Area in 2007 ....................... 11Table 6: Top occupations by mean annual wage in Salem Metropolitan Service Area in 2007 ............................ 11Table 7: Top occupations by both mean annual wage and the number of employees in Salem ........................... 11

Metropolitan Service Area in 2007Table 8: Annual mean wages in 2007 for Salem Hospital ..................................................................................... 12Table 9: Annual mean wages in 2007 for Willamette University .......................................................................... 12Table 10: Annual mean wages in 2007 for state custodial institutions in Marion County ..................................... 12

and State Hospital in SalemTable 11: Per Capita Personal Income (Ranked by 2006 Income) .......................................................................... 18Table 12: Student enrollment for the entire county for the 10 counties with the largest school districts ................ 21Table 13: Number of students eligible for free and reduced lunch in target 10 counties ........................................ 21

between 1999 and 2007Table 14: Percentage of free and reduced lunch eligible per population of students from 1999 to 2007 ............... 22Table 15: Marion County students who are eligible for free and reduced lunch ..................................................... 23Table 16: City of Salem Crime Statistics ................................................................................................................. 25Table 17: Five-year profile of total crimes for Oregon’s Counties .......................................................................... 27Table 18: Prison Admissions by County (Top 10) ................................................................................................... 28

Figure 1: Mean annual wages for Salem Metropolitan Service Area in 2007 .......................................................... 9Figure 2: Mean annual wages for Oregon in 2007 .................................................................................................... 9Figure 3: 2003-2007 Annual Wage Trend of Salem Metropolitan Service Area and Oregon ................................. 10 Figure 4: Mean Annual Wage in Oregon’s Six Metropolitan Service Areas in 2007.............................................. 10Figure 5: Comparison of 2007 annual mean wages in Marion County .................................................................. 13Figure 6: Distribution Curve of Annual Wages at Willamette University ............................................................... 13Figure 7: Distribution Curve of Annual Wages at Salem Hospital ......................................................................... 14Figure 8: Distribution Curve of Annual Wages at State Custodial Institutions in Marion County ......................... 14 Figure 9: Per Capita Personal Income (Ranked by 2006 Income) .......................................................................... 16Figure 10: Per Capita Personal Income 2002-2006 (with growth percentages) ....................................................... 17Figure 11: Unemployment for Oregon, the Portland Metropolitan Service Area and

Salem Metropolitan Service Area between January 2005 and June 2008 ........................................... 17Figure 12: 2006 Adjusted Gross Personal Income (Oregon Counties) ..................................................................... 20Figure 13: Percentage or race demographics in Marion County’s School Districts (combined) .............................. 23Figure 14: Marion County students who are eligible for free and reduced lunch as a percentage ........................... 23Figure 15: Crime Trend Per 1,000 Salem Residents ................................................................................................. 26


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Employer Employees1 State Government 19,1002 Local Government 17,8003 Salem Hospital 3,5004 T-Mobile 1,1005 Norpac Foods 1,1006 Truitt Bros. Inc. 9197 SAIF Corporation 7118 Kaiser Permanente 5509 Wachovia 510

10 Food Services of America 47711 Bruce Pak 45012 Medallian Cabinetry 41513 Forest River 41014 May Trucking Co. 40615 WinCo Foods 36416 GE Infrastructure, Security 35017 Statesman Journal 34818 Phillips Industries 31019 Champion Home Builders Co. 30020 Kettle Chips 26521 RainSweet 25022 Marquis Spas 24423 Don Pancho Authentic Mexican Foods 22024 Universal Forest Products 11525 Nordstom 21026 Boise Cascade Corporation 204

(as of 12/31/07)Salem MSA Largest Employers

APPENDIx A


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Kreamer Farms Mt. Angel 500-999Cooley’s Gardens, Inc. Silverton 100-249Greenleaf Farms St. Paul 100-249Stauffer Farms Inc Hubbard 100-249Curly’s Dairy Salem 100-249

River Bend Sand & Gravel Salem 100-249LCG Pence Salem 100-249River Bend Sand & Gravel Salem 100-249Walling Sand & Gravel Co Salem 100-249

T-Mobile Salem 1000+Norpac Foods Inc Salem 500-999Bruce Pac Silverton 250-499Statesman Journal Salem 250-499Truitt Brothers Inc Salem 250-499GE Infrastructure Security Salem 250-499Blazer Industries Aumsville 100-249Boise Cascade Corp Salem 100-249Coleman Ranch Dairy St. Paul 100-249Eagle Newspapers Inc Salem 100-249Fjord Ltd Hubbard 100-249Gem Equipment of Oregon Inc Woodburn 100-249Hanard Machine Inc Salem 100-249

Kettle Foods Inc Salem 100-249Northwest Hazelnut Co Hubbard 100-249Oregon Cherry Growers Salem 100-249Oregon Fruit Products Salem 100-249Patrick Industries Inc Woodburn 100-249Philips Products Co Stayton 500-999Redman Industries Silverton 100-249Summit Sportswear Salem 100-249Trus Joist MacMillan Stayton 100-249Garmin AT Salem 100-249

May Trucking Co Salem 1000+Northwest Natural Gas Salem 100-249Portland General Electric Salem 100-249Salem Area Mass Transit Salem 100-249

WinCo Woodburn 500-999Sunland Hay Export Salem 250-499Blue Heron Farm Salem 100-249Coalman Ranch Dairy St. Paul 100-249Jet Heating Salem 100-249Kraemers Nursery Inc Mt. Angel 100-249Treco-Oregon Rootstock & Tree Woodburn 100-249Woodburn Nursery & Azaleas Woodburn 100-249Source: Strategic Economic Development Corporation

Agriculture, Forestry, Fishing

Construction

Manufacturing

Transportation & Public Utilities

Wholesale Trade

Largest Employers in Marion County (by industry and location)


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Fred Meyer Salem 500-999JcPenny Company Salem 250-499K Mart Salem 250-499McDonalds Salem, Silverton, Stayton, Woodburn, Dallas 250-499Meier and Frank Salem 250-499Nordstrom Salem 250-499Roth’s IGA Salem, Woodburn, Stayton, Silverton 250-499Salem Canned Foods Grocery Salem 250-499Sear Roebuck Company Salem 250-499Shop Ko Salem 250-499Target Salem 250-499Wal-Mart Salem, Woodburn 250-499Winco Salem, Woodburn 250-499Albertson’s Salem, Keizer 100-249Atkins Thriftway Aumsville 100-249Bi-Mart Salem, Woodburn, Monmouth 100-249Bridgeway Salem 100-249BTN of Oregon Salem 100-249Burger King Salem, Woodburn 100-249Community Support Service Salem 100-249Cooley’s Gardens Inc Silverton 100-249DeLon Downtown Auto Salem 100-249Energy Program Salem 100-249Excel Photo Salem 100-249Home Depot Salem 100-249Jacks Food Salem 100-249Jason Lee Community Food Bank Salem 100-249Keizer Retirement & Health Inc Keizer 100-249Les Schwab Salem, Woodburn 100-249Life Source Natural Foods Salem 100-249Network Behavioral Healthcare Salem 100-249Oregon Housing & Association Service Salem 100-249Oregon Parks and Recreation Department Detroit 100-249Rite Aid Salem, Woodburn, Silverton 100-249Roberson Motors Salem 100-249Rock-n-Rogers Salem 100-249Safeway Salem, Woodburn, Stayton 100-249Schreiner’s Iris Garden Salem 100-249Shop N Kart Woodburn 100-249Skyline Ford Salem 100-249Taco Bell Salem, Keizer 100-249Valley Motor Salem 100-249Walgreen’s Salem 100-249Willamette Pontiac Jeep Salem 100-249Withnell Dodge Salem 100-249Source: Strategic Economic Development Corporation

Retail Trade


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Salem-Keizer School District Salem 4000Salem Hospital Salem 3,500Chemeketa Community College Salem 1000Oregon State Hospital Salem 1000Kaiser Permanente Salem 500-999Willamette University Salem 500-999Garten Services Salem 250-499Goodwill Industries Salem, Silverton, Woodburn 250-499Oregon State Penitentiary Salem 250-499Silverton Hospital Silverton 250-499Salem Clinic Salem 250-499Capitol Manor Salem 100-249Courthouse Athletic Clubs Salem 100-249Doctor’s Clinic Salem 100-249Head Start Salem 100-249Marion County Family Planning Salem 100-249Oakcrest Rehab. & Healthcare Salem 100-249Options Counseling Service of Oregon Salem 100-249Rockwest Training Co. Salem 100-249Salem Area Seniors of Keizer Keizer 100-249Santiam Memorial Hospital Stayton 100-249Union Gospel Mission Salem 100-249Valley Mental Health Salem 100-249Western Baptist College Salem 100-249YMCA Family Salem, Keizer 100-249YMCA Family Santiam Stayton 100-249

Oregon State Corrections Department Salem 1000+State of Oregon Human Services Department Salem 1000+Attorney General Dept. Salem 500-999State Police Salem 500-999Salem Parks & Rec Dept. Salem 250-499Hillcrest Youth Correctional Salem 100-249Information Resource Management Division Salem 100-249Inmate Work Programs Salem 100-249Marion County Corrections Salem 100-249Marion County PWD Salem 100-249Marion County Sheriff’s Office Salem 100-249Oregon Education Department Salem 100-249Public Utility Commission Salem 100-249Salem Fire Department Salem 100-249Salem Police Department Salem 100-249Salem PWD Salem 100-249Children & Family Services Salem 100-249Transportation Department Salem 100-249US Forestry Department Salem, Detroit 100-249US Land Management Bureau Salem 100-249US Post Office Salem 100-249

SAIF Corporation Salem 500-999BlueCross BlueShield HMO Salem 250-499Coldwell Banker Mountain West Real Estate Salem 250-499Prudential Real Estate Salem, Stayton, Keizer 250-499West Coast Bank Salem, Keizer, Woodburn, Stayton, Silverton, Dallas, Monmouth 250-499County Companies Insurance Salem 100-249First Pacific Corporation Salem 100-249State Farm Insurance Keizer 100-249US Bank Salem, Keizer, Monmouth, Mt. Angel, Canby 100-249Washington Federal Savings Salem, Dallas, Monmouth, Woodburn 100-249Washington Mutual Salem, Hubbard, Stayton, Woodburn, Silverton 100-249Wells Fargo Bank Salem, Canby, Keizer, Mt. Angel, Silverton, Stayton, Woodburn 100-249

Services

Public Administration

Finance, Insurance, & Real Estate

Source: Strategic Economic Development Corporation

Documents

An Economic Analysis Of Locating Oregon\'s Custodial Institutions In Marion County and The City Of Salem