In this paper we will try to define the impact of an institution of Higher Education (Universidade Lusiada de Vila Nova de Famalicão UL-VNF) in its neighbouring region, regarding its impact on regional development and sustainability. UL-VNF is a small University owned by a private non profitable entity: Fundação Minerva. UL-VNF has graduated some 2800 students in its 20 first years of existence. UL-VNF provides students with first degree diplomas in Accountancy, Economics, Management, Marketing, Civil Engineering, Industrial Engineering, Electronic Engineering, Textile Engineering and Architecture. Famalicão is a new city (celebrating 25 years in 2010) located in the North of Portugal, between Porto and Braga. The neighbouring region of Famalicão is at the hearth of the industrial Portugal. Universities are engines for economic development. The presence of a university contributes to the regional economy by enhancing human capital through education, by creating new knowledge through research activity, by developing and transferring new technology, and by creating favourable environments that attract innovative businesses and individuals. At the moment these institutions all over the world are facing an era of increasing financial pressures. As Alexander (2000 p. 411) observed: “Governmental authorities are no longer as receptive to the traditional self-regulatory processes that have dominated university development for centuries. The purposes of this paper are to describe methodological approaches and pitfalls common to these impact studies, and to suggest more productive ways to think about the local economic impact of colleges and universities. Quoted by Siegrfied and al , 2008 Caffrey and Isaacs in 1971, produced a systematic template to organize the measurement of economic impacts. Since 1971, the number of impact studies has grown, and innovations have added to their complexity and breadth. The basic procedure is to sum expenditures of the college community (students, faculty, staff and visitors) created by the presence of the institution and apply multipliers to account for the interdependency of economic activity in a local economy. Other contributions to the university impact literature (Siegfried, 2008): Beck, Elliott, Meisel and Wagner (1995), who propose new methodologies, attempt to account for short-run and long-run flows, and give alternative ways of thinking about geographic regions; Brown and Heaney (1997),who discuss the traditional "economic-base" approach; Felsenstein(1996), who uses Northwestern as an example of a university's impact on a metropolitan area; and Blackwell, Cobb and Weinberg(2002), who discuss traditional and human capital impacts, and conduct a case study of Xavier University in Cincinnati.

This will be a descriptive/analytic case study that will serve as the basis of a comparison with other studies already undertaken on the impact of universities on regional development. We will use three kinds of data and three types of instruments. 1) basic statistics related to the Northern Region and to the University to describe the parallel evolution of both entities in the last twenty years. 2) contacts with major companies and organizations to have a survey of their feelings towards the importance of the University in the local development. 3) an anonymous questionnaire sent to each one of the 2800 graduates of ULVNF. The questionnaire will address: Identification: Career: Economic consequences. This study will not be based on a one-off questionnaire, since it will be repeated every two years in order to analyse the stability of the data given current economic recession and to identify any longitudinal trends.

We build upon the findings of “UniRegio” an INTERREG III Joint Project between Austria and Hungary, (January 2005- March 2006): a) With few exceptions regional development is not mentioned in strategic documents, such as mission statements of the Universities; b) The interviews with regional development professionals showed that a good supply with a qualified labour force and human resources is considered essential for a competitive region; c) Structural obstacles to efficient contributions in capacity building for regional development of higher education institutions can be found at an organisational and at a communication level. Having this message in mind we hope to define how much did the UL-VNF contribute for the development of its local community. We hope to conclude that UL.VNF became an important social force in the neighbourhood region with positive impacts in terms of skills, businesses, employment, and income generation and ultimately in the sustainable development.