(1) Benefits to Professional Staff

As noted above, Merrick employs about 153 professional staff, with FY 2011 salaries averaging $27,132 and full-time benefits packages valued at an average of $5,817 per year. The staff members obviously benefit from being employed: total employee hours at Merrick are forecasted at 145 per month in fiscal year FY 2011, with total compensation for the year for all employees budgeted at $4,151,107 million dollars. Much of this income is returned to the Minnesota economy through a "multiplier effect" which, if a very conservative wage-multiplier of 2 is used, implies final spending of $8,302,214 million dollars per year.

Apart from direct wage effects, many of Merrick's employees are actively engaged in professional development activities, increasing their skill levels so as to move up the professional ladder. As an example, since March 2006, Merrick has granted 42 scholarships totaling $63,000 to 31 employees using funds from the MN HCBS Employee Scholarship Program that can only be used by hourly employees for additional education and/or training leading to increased wages or promotional opportunities. As a result, they can expect to improve their future earnings prospects and increase not only their own levels of living but expand their multiplier effects in the years to come.

(2) Client Salaries and Satisfaction

Wages earned by Merrick clients are modest by any standards, but are still a source of economic support and a wage stimulus to the Minnesota economy. Total client earnings at Merrick in FY 2010 were $536,750. Using the same multiplier calculation described for professional staff, such client wages generated $1,073,500 in final economic activity. In fact, the multiplier is probably higher because most are charged co-pays, have program fees (MA-EPD), or must "spend down" to remain Medicaid eligible so that a lower proportion of their earnings is saved. Additionally, if only 50% of these earnings are spent on items subject to the state sales tax, clients at Merrick pay $18,000 a year in sales tax and, based on a 2005 report, all clients in DT&H programs pay over $1.5 million annually in state sales tax. Beyond any monetary reward, wages earned by clients generate an incalculable but significant form of social capital: a sense of belonging and self-worth.

(3) Avoided Costs of DT&H Service in Group Homes

During the period each weekday that clients attend Merrick, they no longer draw on the resources of their domiciles, whether family or group homes. While little data exists on the personal costs foregone in private homes, it is clear that Merrick employment allows family members who would otherwise be full-time caregivers to maintain outside employment themselves. In the case of group homes, the approximate per-hour cost of care is $7.30 per hour (in SFY 2007 there was an average of 14,096 people served in group homes at an average annual cost of $63,865 in state and federal funds divided by 8,760 hours). 7 Since clients attend Merrick an average of 6 hours a day for an average of 235 days a year, the avoided costs to the group home providers equals about $10,293 per client per year, which when multiplied by the approximate number of clients (210) living in a group home results in a savings of $2,161,530 or 42.8 percent of the $5,048,782 in State and Federal funds paid to Merrick in per-diems in FY 2010. If a similar calculation was put to private home care, an additional $1,260,090 in avoided costs would put the total at $3,422,423, or 67.8 percent of State and Federal funds paid to Merrick in per diems in FY 2010. This is likely to be an underestimate, since the employment available to home caregivers is most likely greater than the group home DT&H rate.

(4) Tax and Other Revenue Benefits

Merrick professionals and clients pay taxes. While client wages are typically too low to be subject to tax, professional staff salaries, averaging about $27,000, fall into the 5.35 percent range in Minnesota's revenue calculations. For a single payer, after accounting for a personal exemption of $3,650 and a standard deduction of $5,700, taxes paid to Minnesota in 2010 would be based on an adjusted income of $17,650. At a 5.35 percent rate, this equals $944 in taxes paid to Minnesota per employee. If all 153 employees at Merrick paid at this rate, it would equal $144,432 in taxes paid to Minnesota. Also, in FY 2011, Merrick budgeted $401,766 for fleet fuel, maintenance, and license expense to operate its fleet of 65 vehicles. This resulted in payments to local providers of fuel, maintenance and licensing bureaus that in turn spent these dollars in the course of their business. Finally, Merrick operates pull-tab booths at 14 locations with a FY 2011 forecasted revenue of $9,476,142. 8 Of this, the state receives 5.2 percent or $492,759. Not many DT&H programs operate pull-tab booths and Merrick uses 1% of this total for lawful purpose expenditures to support its mission, equaling $102,393.

(5) Private Sector Benefits

The companies and corporations that do business with Merrick, while clearly committed to hiring people with disabilities, do so consistent with sound business principles. In some cases, businesses are eligible for a targeted jobs tax credit (TJTC) of up to 40% of the client's first 12 months of wages. The federal minimum wage is $7.25. At 20 hours a week for 50 weeks, this equals $7,250 in the first year, of which 40 percent is $2,900. Approximately 50 clients at Merrick work in this situation, implying total first-year tax credits of $145,000. In return, businesses receive work product equal to, and in some cases better than, that which would result from standard non-disabled wage and contract terms. This "win-win" arrangement is clearly an enormous source of satisfaction to employees with a disability, but it is also a benefit to the employer. By helping the employer to support ongoing business activity while also supporting citizens with disabilities, day programs are effectively "brokering" private and public sector benefits.

(6) Merrick-Leveraged Foundation and Charitable Giving

Much emphasis is given in some quarters to the need for citizens with disabilities to seek support not from government, but from their own resources and initiative. While the clients at Merrick are unlikely to seek out, apply for and find foundation or charitable support, the employees at Merrick, Inc. do so. In fact, Merrick received an average of $390,556 per year from donations, fundraising, and grants in the last five years. While some of these grants might have gone elsewhere if Merrick did not exist, many are tied directly to Merrick and its mission.