Voter, Can You Spare a Dime?

Many community colleges attempt to build support for bond referendums during tough economic times, attempting to fund building expansions for growing enrollments.
August 14, 2008

When economic times are tough, enrollments at most community colleges usually swell. And when two-year public institutions face rising demand, they often turn to local taxpayers -- in the form of either bonds or tax levies -- to ease the financial strain caused by the growth. But that circular chain can cause conflict at the voting booth.

Recognizing the realities of the current uneasy economy and the strain it puts on taxpayers, some community colleges are preparing to ask for more money from their communities this Election Day, when voters, potentially, may not have all that much to offer. These institutions must strike the delicate balance of timing versus need.

Administrators at several community colleges that are navigating that terrain now argue simply sticking to one's institutional mission is enough to convince voters in a slumping economy to further financially support an institution. If clear and forthright about institutional needs, whether structural or operational, these administrators say, the public will ultimately support a college they see as serving its community's educational needs.

Other administrators, however, think voters need more concrete reasons, beyond a blanket institutional plea, to ask for more funding, especially in tougher economic times. In these cases, community advocates including local businesses should be brought in to demonstrate how a community college and furthering one's education lead to a burgeoning economy. Voters who see the clear connection between increased educational opportunities and future financial success, in their minds, will be more apt to support a bond referendum in a time when their finances might be limited.

There are, however, other ways to ensure referendum success in tight economic times, said George Boggs, president and CEO of the American Association of Community Colleges. If proposed funds are slated for construction or renovation projects, he noted that there is a bit of flexibility in the asking price when presenting a bond measure or tax levy to voters. A college could potentially use older facilities for a longer amount of time or use temporary structures to save money. Boggs also said that adjusting the overall amount of a levy has the potential to swing voters in favor of a community college measure. For example, a voter unwilling to pay $1 per $1,000 of assessed income may be willing to pay 50 cents instead. Boggs, however, said that if an institution is seeking essential operational funds for an already constrained budget, there is likely less flexibility. No matter the case, he argued anticipating a favorable time for a bond measure is often a bad bet. There may be no better time to ask for funds.

“Some consultants who help colleges with these bonds will advise them to put them on the ballot when there is less of a turnout and some say to put it when there is a greater voter turnout,” Boggs said, suggesting there is often no way to determine if a bond referendum will be more or less likely to succeed during an off election year than a busy presidential or gubernatorial election year. “It depends on a number of factors and whether other bond issues are on the ballot. You might want to avoid a college bond being on the same ballot as a high school or hospital bond.”

Crowded Ballots

Cape Fear Community College, in Wilmington, N.C., had competition on the ballot during its last bond referendum in 2005. It asked for a bond of $150 million and the local school district sought a bond of $123 million, said Eric McKeithan, the college’s president. In an off-year election with these two referendums on the same ballot, the public school system won its bond but the community college lost.

McKeithan said he tries to see the silver lining in the dark cloud of his college’s failed referendum. The 9 percent voeter turnout in the last election has cleared the ballot for its bond referendum in the upcoming election. As voters were more likely to support only one of the two measures in the college's last attempt, he said he thinks it stands a better chance this time without another bond on the ballot. Looking ahead to the fall election, if his institution’s recently proposed $164 million bond officially makes the ballot, it will not have to run beside another referendum from the school district, as McKeithan said the district has almost $43 million in unspent funds from the 2005 measure.

Now, the college is concentrating on persuading voters of its value in local economic development and hoping to win votes. Though McKeithan admits that most analysts have a bleak outlook on the state of the U.S. economy, he said Wilmington residents enjoy a relatively strong economy compared to that of the rest of North Carolina and the country.

Part of the reason for this boom, he said, is the role Cape Fear plays in educating a skilled work force that attracts major outside businesses to the area. The recent opening of a 1,200-employee Verizon call center and the expansion of a General Electric plant in the area are due in some part to articulation agreements these businesses put in place with the community college to train employees and create programs specifically for their job openings, McKeithan said.

Additionally, he noted that the rapidly growing local health care community recognizes the college as its primary source for registered nurses. McKeithan plans to gather these local businesses and get them to talk publicly about the benefit of the college. For an institution that conservatively projects its enrollment to grow 31 percent by 2013, Cape Fear is at a critical juncture in its growth, he said, adding that the college will either have to expand or turn away qualified students to operate. He worries that stunting his college’s growth could potentially drive some businesses from the area.

“Our challenge is to help voters make the connection between education and the economy,” McKeithan said, adding that the proposed bond would pay for the construction of three buildings to keep up with the college’s growth in enrollment. “We say, local training for local people for local jobs. In this election, by all accounts, there is going to be record turnout. We have to depend on good information to get the voting public to see [the community college] as an investment to make in our future. Let’s suppose this bond doesn’t pass. We know that we’re jammed for space right now.”

Before going to voters in November, Cape Fear’s bond has to be approved by the local county’s board of commissioners at an upcoming public hearing. Though a poll conducted by the college in March indicated 69 percent public approval for the bond, there are some in the community who think there is a more cost-effective way for the college to raise money for its expansion. At a prior meeting outlining the bond, Bill Kopp, New Hanover County Commissioner, was the only member of the local board to vote to oppose sending the bond to a local fiscal watchdog group before it returns for proper approval. His position was not to oppose the funding or question the need of the college, Kopp said, but only to suggest another method that may be less of a burden on taxpayers.

If the $164 million bond passes, Kopp said it will cost an additional 4.9 cents on the current 45.25 cent property tax per $100 of assessed property to pay off, adding that this new levy would come on incrementally as the county sells the bond. Instead, he said he thinks it makes more sense to make use of a new sales tax initiative passed by the North Carolina General Assembly. It authorizes counties to levy a 0.25 cent sales tax increase, with voter approval, for whatever infrastructural purposes they deem necessary. If this measure were to appear on the ballot, however, Kopp said the county would be unable to state for what it was being considered. Although Kopp admits this might present an obstacle for some voters, he said this sales tax levy would generate about $8 million a year for the community college and would take the burden off of property owners in the county, some of whom already complain that their taxes are too high.

Being Good Stewards

Despite the inevitable tax hike that results from a successful bond referendum, some college presidents are betting that a good relationship with their surrounding community will pay off in the voting booth come Election Day. Los Rios Community College District serves the greater Sacramento, Calif., area. Brice Harris, the district’s chancellor, said that 1 in 12 district residents are enrolled in some community college course, adding that he believes a significant percentage of the area’s voting public understands why his community college is important to economic development as a result.

Hard economic times, as represented in the area’s recent loss of jobs and high unemployment, have driven the college’s enrollment up by 25 percent in four years, Harris said, noting that his district’s four colleges serve almost 88,000 students. As a result of this growth, the college has put a $475 million bond referendum on the fall ballot to build new and remodel old buildings. In California, he noted, referendums must be undertaken during even-year elections, either presidential or gubernatorial. Additionally, he said the measure must pass by 55 percent to take effect. Clarity and honesty is important when making a case to voters, Harris said, adding that the legitimate needs of the college to handle growth help make a strong case.

“I think it’s hard to get a voter to approve remodeling money for a building you’ve let go to pot,” Harris said. “I’ve never had to go to voters and say, ‘Our roofs are leaking.’ You wouldn’t do that in your own home, and I don’t expect voters to do that here. You have to be honest and candid with what you plan to do with voters’ money. Assuming you have the needs, you have the case and you’ve been good stewards of their money in the past, I’m happy to live with whatever the voters say.”

Attempting to time a bond referendum with what one thinks the economy is going to look like is a common mistake some community colleges make, Harris said, noting he has no idea what the U.S. economy may look like in the fourth quarter of the year. Instead, he said colleges should be driven by what their needs are at the moment. Twin polls conducted in December and May by the college indicate that though a majority of voters favor the bond referendum, the majority has softened a bit. Harris said the 68 percent in favor in December sunk to 65 percent, with more voters in May electing to switch their vote to undecided instead of opposed to the referendum. Still, he is optimistic about Los Rios’s bond measure in November.

“In tough economic times, the electorate of voters in California is quite sophisticated,” Harris said. “I think they understand the connection between education and the economy.”

The Big Ask

Other colleges have to face the reality of making an appeal to voters for funds more than one year in a row. Wayne County Community College District, serving Detroit and the surrounding county, will make yet another attempt to renew a 10-year, $1.5 million bond that generates about $33.5 million a year for the college, after the measure failed to pass last year. Vidya Moorthy, a college spokesman, said that since the initial tax was approved in 2001, the college’s enrollment has grown 311 percent. As about 40 percent of the college’s budget is funded by this tax, she said it was important for the institution to attempt the renewal before 2011, when the tax expires, so that it can have a contingency plan in the event that the referendum does not pass in the fall.

“The economic downturn has tremendously affected this region because of its impact on the automotive industry,” said Curtis Ivery, the district’s chancellor, noting that Wayne County is the fastest growing community college in Michigan and the fastest growing with an enrollment of more than 10,000 in the country. “That has really impacted the need for our existence. There’s a paradigm shift in the work force. This has meant that we’ve had to rethink the kind of jobs and programs we offer. We’ve had to do that to respond to our constituency.”

Wayne County is trying to “play catch up” for almost 35 years without any funding aside from state grants, Ivery said. In the event that this tax renewal fails in November for the second year in a row, he noted that the college would have to consider a reduction in both employees and campuses. Still, he is confident that voters in his region are passionate about the institution and will approve the renewal in the fall. Though Ivery admits that the college has had less success with suburban voters, he said its strategy this year is to concentrate on the work it does in the classroom. Some attempt, however, has been made to reach out to these suburban voters. A recent Detroit News article noted that the community college district recently sponsored Fourth of July fireworks in a neighboring suburb, apparently to improve relations.

“The body politic will take care of itself,” Ivery said, confirming that the college did sponsor a firework display as a method of community outreach. “The community service is the largest function in any community college. Support is in the eye of the beholder. Some people simply don’t like to pay taxes. I can’t change that. I can only do a good job of providing instruction and giving all of our people something to be proud of. I can’t read their minds and their motives for not voting for this resolution. You’re always going to have those people.”

Enjoying Support

When facing the renewal of a bond, some community colleges are in seemingly more favorable situations. Lane Community College, in Eugene, Ore., will ask voters to approve a 15-year bond for $83 million to be used for building renovations. Mary Spilde, the college's president, noted that its previous bond from 1995 will be completely paid off and that the college needs the funds to meet increased demands for enrollment. In her area, tough economic times have resulted in expanded enrollment as locals reevaluate and look to upgrade their skills and credentials. Although there is a K-12 bond measure on the ballot as well, Spilde said she believes that Eugene's voters will support both measures. She noted that the college has tried to portray itself as a natural extension of K-12 in the larger educational system, openly supporting the other bond referendum.

“It’s going to be a busy election,” Spilde said of this presidential election year ballot in Eugene. “Just getting people to the bottom of the ballot, where community colleges typically are, is quite a challenge. There are other colleges that are floating bond proposals which will increase taxes. We’re in a slightly more fortunate position in that this isn’t a tax increase. It’s just time to go back to the voters and ask them to continue to do what they’re already doing and show a continuing support.”

Though Spilde expects her college’s bond referendum to pass, she said a political action committee was formed to help generate even more support in the community for the ballot measure. The committee, she noted, hired a consultant to conduct a study of the community’s thoughts about the college, which she noted were favorable. When it comes to financing a college, however, she said one can never be too careful.

“Even though the community supports us and this is sort of a tax continuation, we can’t take it for granted,” Spilde said. “We need to make sure our community members have all of the information they need to make an informed decision. We can’t sit back and say, ‘This is going to pass.'"


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