February « 2011 « Policy Matters

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Over One Quarter of Community College Students in Mississippi Need to Go Into Debt to Get an Education

February 22, 2011

Filed under: Budget & Tax,Education,Income & Working Families,Self-Sufficiency — admin @ 10:25 AM

A previous article on student loan debt encouraged a deeper look at the volume of Mississippi community college students that need the financial support of federal student loans to pay for school. In 2008-2009, 21,113 community college students in Mississippi borrowed federal student loans. The 21,113 students taking out loans represent 28.9% of all community college students in Mississippi.

In the wake of rising enrollment and constrained state support, many colleges have had to raise tuition to cover the cost of instruction and operations. Average tuition at all of the state’s community colleges rose 19.7% from 2008-09 to 2010-11¹. The rise in tuition indicates more students may require larger loans to cover the cost of pursing a postsecondary degree. State and national leaders face the challenge of keeping tuition affordable and providing sufficient financial aid to students most in need.

In 2008-09, students at Mississippi’s community colleges took out $90.2 million in student loans. On average, students borrowed $4,272 per year through student loans for expenses associated with attending classes. The chart below lists average federal student loan aid by community college.

Average Federal Student Loan Aid Received by Community College, 2008-09

Postsecondary education remains a critical avenue for moving towards economic security in Mississippi. As decisions are made for the FY2011-12 budget year, the data on student loans is a reminder that funding of higher education not only affects community colleges, but also the debt burden students may face as they seek to advance to quality careers and self-sufficiency through higher education. A balanced approach that includes raising revenue is required to allow the state to maintain its vital investments in higher education and to keep a community college education affordable for all Mississippians.

Author: Sarah Welker, Policy Analyst
Source: U.S. Department of Education. National Center for Education Statistics. IPEDS Data Center.

¹State Board for Community and Junior Colleges. Finance and Administration Division. Average Tuition and Fees for In-state Residents.

Note: MS Delta, Coahoma, and Southwest Mississippi Community Colleges each did not have any federal student loans reported in 2008-09.

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Forbes Ranking Shows Education Key to Keeping Mississippi Competitive

February 17, 2011

Filed under: Budget & Tax,Income & Working Families — admin @ 2:02 PM

As the election season starts to get going, education and business climate are receiving more and more attention. A ranking by Forbes shows that the two are inextricably connected when it comes to moving the state forward.

In Forbes Best States for Business and Careers, Mississippi ranks 48^th for 2010, down eight spots from the 2009 ranking. Forbes rankings take into account six areas, Business Costs, Labor Supply, Regulatory Environment, Economic Climate, Growth Prospects and Quality of Life. Mississippi’s rankings for each area are in the table below.

Mississippi’s 2010 Forbes Best States for Business and Careers Rankings

While business costs (which include taxes) received a favorable ranking relative to other states, Mississippi received low marks for labor supply, economic climate and quality of life. The Labor Supply category measured educational attainment, net migration and projected population growth. The Quality of Life area measured schools, health, crime, cost of living and poverty rates.

The rankings demonstrate that a comprehensive approach – which includes adequate investment in Mississippi’s education systems – is needed to improve the state’s overall competitiveness.

Over the past couple of years, investments in the systems that educate children and train the workforce have been underfunded by hundreds of millions of dollars. In the face of falling further behind, options to increase revenue should be on the table to target investments and to improve Mississippi’s overall opportunities for development.

Author: Sara Miller, Senior Policy Analyst

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Why Should Working Mississippians Pay More?

February 10, 2011

Filed under: Predatory Lending — admin @ 11:27 AM

Currently, negotiations are underway to craft a bill to reauthorize Mississippi’s payday lending law. If proposed changes are approved, Mississippi will remain the most expensive state in the Southeast to get a payday loan. The chart below illustrates how Mississippi’s fees compare to the fees paid by payday loan borrowers in the Southeastern States:

The chart raises the question – why should working Mississippians pay $50 for a payday loan when working families in Tennessee pay $30 for the exact same loan? Given that the law does not sunset until July of 2012, lawmakers should vote no on HB455 and make meaningful changes in the next legislative session.

Author: Ed Sivak, Director MEPC
Source: MEPC analysis of information from the Financial Service Centers of America

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Most Large Corporations in Mississippi Pay Zero State Income Tax

February 4, 2011

Filed under: Budget & Tax,Mississippi Economic Recovery Resources — admin @ 11:16 AM

New research from the PEER Committee provides data on corporate participation in the state’s corporate income tax. The research shows that approximately 80% of all corporations operating in Mississippi do not pay state corporate income tax. The PEER data also shows that 70% of the largest corporations (as measured by payroll withholding) do not pay corporate income taxes. The PEER Committee examined tax data from 2006 – 2009. The large number of corporations paying no corporate income tax is striking, especially in the years of prosperity before the recession affected corporate profits.

Corporations Operating in Mississippi Paying Zero State Income Tax 2006-2009

Corporate profits are subject to Mississippi state income taxes at the same rates and brackets as individual income taxes. The rates are 3% on the first $5,000, 4% on the next $5,000 and 5% on profits over $10,000. Possible reasons for not paying corporate income tax include operating at a loss or shifting profits to related corporations in other states. One way to end the practice of shifting Mississippi profits to other states would be to require related multi-state corporations to report their income together – a practice known as combined reporting.

Stay tuned for more information about combined reporting and the state’s corporate income tax.

Author: Sara Miller, Senior Policy Analyst

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JobWatch Summary

February 2, 2011

Filed under: Mississippi Economic Recovery Resources,Self-Sufficiency — admin @ 12:42 PM

Key Takeaway: Mississippi has experienced 5 consecutive months of slow job growth from July to December 2010 with a total increase of 10,800 jobs.

Trends in Overall Job Numbers
For many months, state economists have predicted slow, subtle job growth as Mississippi and the nation’s economy enters a period of recovery. The most recent jobs data from the Bureau of Labor Statistics reflects this trend. From a low in July 2010, Mississippi has added 10,800 jobs. The state still had 68,400 fewer jobs in December than in February 2008, the month when Mississippi’s employment peaked.

MS Unemployment Rate
Five months of job growth has led to a decrease in the state’s unemployment rate over the same period. From July to December 2010, Mississippi’s unemployment rate fell from 10.8% to 10.1%. The unemployment rate peaked in March of 2010 at a rate of 11.6%. As the economy recovers and more adults again start to look for work, Mississippi will need jobs for adults newly seeking employment on top of the jobs needed for those that are currently in the job market and looking for work.

Industry Trends
The most recent information from Mississippi’s IHL Research Center reveals that among MS industries, professional & business services and leisure & hospitality experienced the largest growth while government employment, and local government employment in particular, is falling. IHL attributes the local government job loss in part to persistently low revenues from sales and property taxes, both of which have been especially affected by recession. The contrast between job gains in private employment and job loss in public employment may continue across Mississippi as state and local governments struggle to adequately fund programs and keep staff in the wake of continued financial hardship.

Author: Sarah Welker, Policy Analyst
Source: Economic Policy Institute. December 2010 JobWatch Data

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