Referendum - Western's Vision 2020

Referendum

Referendum

Referendum Results

Final Certified Results
Detailed vote breakdown.

Yes
63,715

54.15%
No
53,941

45.85%
211 of 211 precincts reporting.
117,656 total votes.

Financial Impact

We acknowledge that the price tag is considerable. But we believe now is the best time to make this investment in the future. Interest rates are low right now; we don’t know what they will be in another 5 years. The estimated savings in interest costs alone on this project is more than $20 million over 20 years.

We need the facilities now to meet the job demands of the present—and future. Vision 2020 allows us to plan for the future today. If voters approve the referendum, Western will be authorized to borrow the necessary funds over five years. The property tax impact on the owner of a $100,000 property is estimated not to exceed $3.25 per month or $39 annually.

Project Summary



What makes now a good time to borrow?

1. Interest rates are at historically low levels; the estimated savings in interest costs alone on this project is more than $20 million over 20 years.

In fact, interest rates are less than the rate of inflation.

What does that mean in dollars and cents? For each 1.00% reduction in the borrowing interest rate on a $79,800,000 financing, the total interest cost estimate over 20 years is reduced by $10,000,000.

  • Average 20 Year Tax-Exempt interest rate over past 25 years is approximately 5.50% (Source: Thomson Reuters MMD index)
    • Current market rates are approximately 2.00% below the 25 year historical average
    • Market opportunity to avoid $20,000,000 of interest cost

The graph below shows the historical trends for interest rates.

The Municipal Market Data (MMD) Index is produced by Thomson Reuters. It shows Tax-Exempt Interest rates for large AAA rated municipal issuers. This index provides data going back 30 years.

Tax-Exempt Municipal Bond Interest Rates


2. Costs continue to rise.

Historical inflation rates indicate a 4.96% average increase in building costs since 1967. If we wait, costs will increase.

Turner Building Cost Index


3. Western’s current long-term credit rating is “AA+” by Standard & Poor’s Rating Agency (S&P)

  • Only 1 higher category on S&P rating scale
  • Highest current rating for District based on S&P’s credit rating factors
  • Provides access to high investor demand and lower cost of financing

Additionally, the S&P report indicated:

Simultaneously, Standard & Poor's affirmed its 'AA+' long-term rating, with a stable outlook, on the district's existing general obligation promissory note debt.

The short-term rating reflects our opinion of the district's:

  • Very strong capacity to pay principal and interest
  • Low market risk profile as it maintains strong legal authority to issue long-term debt
  • Record as a frequent issuer that regularly provides ongoing disclosure to market participants.

The long-term rating reflects our opinion of the district's:

  • Large and diverse economy, centered on the La Crosse metropolitan area;
  • Stable finances, coupled with very strong reserves; and
  • Moderate overall net debt with very rapid amortization.

4. Western’s Debt Capacity

The chart below shows Western’s capacity for incurring debt:

Western has non-referendum-related capital authority to borrow funds to maintain facilities and improve technology. Because we are a technical college, there is an expectation that we will have the latest technology for students to keep instructional programs up to date, including computers and other equipment like CNC machines and patient simulators. We are continually issuing and paying off debt for those purchases (seen in blue).

Since the 1980s, we have gone for referendum roughly every 20 years in order to complete larger projects. The last referendum (1996) has been paid off. The current referendum that will be put to vote on November 6 is seen in green.

Western Technical College District 2012 Debt Capacity



The following chart illustrates the district’s property valuation, divided by county. Note that Western serves all or parts of 11 counties. Each year we review the data to see if there are any areas that are underserved. The goal is to share the cost proportionally, so that the share of total tax aligns with the percentage of students served.


Comparison of Valuation, Tax Share, Population, and Student Enrollment
County 2011 Valuation Share of Total Tax Share of District Population* Share of District Enrollment
Buffalo $425,702,016 2.57% 2.46% 1.20%
Jackson $1,162,295,434 7.03% 6.82% 7.09%
Juneau $1,652,245,049 9.99% 9.66% 8.37%
La Crosse $7,630,015,700 46.12% 43.15% 47.44%
Monroe $2,563,169,200 15.50% 16.82% 15.49%
Trempealeau $1,387,413,696 8.39% 8.80% 8.34%
Vernon $1,617,624,542 9.78% 10.97% 9.92%
Other District Counties $102,808,480 0.62% 1.32% 2.15%
Totals $16,541,274,117 100% 100% 100%

*Based on population updates provided by the Wisconsin Technical College System

How This Impacts You

For the owner of a $100,000 property, the tax impact will be a maximum of $39 per year for up to 20 years. That’s about $3.25 per month. That’s the cost of a coffee drink and less than a gallon of gas.

$39/year is the most taxpayers will pay, and 20 years is the longest they would have to pay.


Documents

General Information


Frequently Asked Questions

What is a Referendum?

A referendum is a direct vote by the public to either accept or reject a proposal. In this case, the referendum question asks voters in the Western Technical College district for the authority to borrow money to support the expansion and construction of Western facilities to meet the high-demand training needs of local students and area employers.

By state law, the amount of money Western can spend on new buildings, additions, or land acquisition without going to voters is limited to $1.5 million per campus every two years. Any new buildings, additions, or land acquisition beyond the $1.5M cap (not funded through gifts, grants, or federal funds) must be approved by voters in a public referendum.

Why Now?

We recognize that this is a difficult economic time. However, the world is changing and Western plays a vital role in the region’s economy. Our 2011 graduates had a median starting salary of $31,054, and recent surveys indicate that after five years in the workplace, our graduates' salaries rose 58%.

Western graduates stay in our communities. In fact, 81% stay in the 7 Rivers region, while 85% stay in Wisconsin.

Western has found that employers are looking for graduates who understand how to work in a team environment, much like employees do every day. Western’s goal is to bring that real-world work environment to the classroom through the creation of Occupational Centers that will increase student engagement and learning across programs.

Western has also found that there is a growing skills gap resulting in shortages for a number of higher-paid positions in manufacturing, transportation, and other areas. There is need for short-term (one-year or less) programs that earn a college certificate or diploma so students can quickly get up to speed for the workforce. The credits earned could then transfer to an associate’s degree and even a bachelor’s degree.

Since 2005, we have had a 47% increase in the number of transfer students served and a 63% increase in general studies enrollment related to both the increase in transfer students and additional program growth and expansion. Students are looking for a more affordable way to learn general studies courses that will transfer to a bachelor's degree program.

In order to meet those goals and student growth, we need to improve existing classroom space. The Occupational Centers will require restructuring of Western’s facilities to accommodate space utilization. Restructuring and remodeling these facilities also allows the opportunity for greater energy efficiency, leading to cost savings.

Who votes on this referendum?

People who live in all (or parts) of these counties will see the referendum question on their ballot: La Crosse, Monroe, Jackson, Trempealeau, Juneau, Vernon, Clark, Richland, Buffalo, and Sauk.

How Will the Ballot be Worded?

The wording on the ballot will look like this:

Shall Western Technical College District, Wisconsin be authorized to issue, pursuant to Chapter 67 of the Wisconsin Statutes, general obligation bonds or promissory notes in an amount not to exceed $79,800,000 for the public purpose of paying the cost of capital expenditures for projects which are included in the District’s Master Facilities Plan consisting of constructing new buildings and facilities; adding to, upgrading, remodeling, and improving existing buildings; acquiring furnishings, fixtures and equipment; and acquiring and improving property?

How does Western impact the local economy?

Each year Western serves more than 16,600 students. 1,200 students graduate each year, and 81% of those grads get jobs and stay in the 7 Rivers region to help grow our communities. With technical college graduates there is no “brain drain” as associated with universities. The majority of our graduates stay here, and contribute to the vitality and quality of our communities. As an example, the following percentages represent the number of grads working at these employers:

  • 22% of employees at Logistics Health.
  • 16.6% of employees at Vernon Memorial Hospital.
  • 16.3% of employees at Trane.
  • 15.8% of employees at Dairyland Power Cooperative
  • 14.23% of employees at Reinhart FoodService.
  • 13.6% of employees at Gundersen Lutheran.
  • 12.2% of employees at the City of La Crosse.
  • 11.25% at of employees at Black River Falls Memorial Hospital.
  • 11.6% at Hillview Health Care Center
  • 10.2% at Walzcraft.
  • 8% of employees at City Brewing.

What impact will this project have on the local economy?

An independent economic impact study indicated that the projects would have a total four-year economic impact of $111,959,706, create 900-plus jobs, and generate $3.4 million in tax revenue.

Why only the La Crosse Campus?

In the past five years, Western has updated or relocated most of its regional locations in order to better serve the students who live throughout the district. Our Tomah and Black River Falls locations moved to their respective downtowns, while Independence and Mauston have been expanded in recent years. Viroqua has also benefitted from updates since their relocation to Main Street and will receive additional remodeling as part of a community project partnership in Viroqua.

The La Crosse Campus has the oldest buildings of any of our locations. The Coleman Center was built in 1923 and uses boilers from the 1960s and air handlers from the 1930s. In order to bring our buildings and the heating/cooling systems up-to-date, and serve an ever-increasing number of students, the decision was made to update the La Crosse Campus.

Will these facilities still be needed long-term?

Forecasts indicate a continuing demand for skilled workers in public safety, health care, manufacturing, agriculture, transportation, and other fields. By 2020, we anticipate 1000 more students (25% increase) will seek education and training at Western. We have already experienced a 14% increase in students since 2007.

In addition to students seeking degrees, these areas also have high demand for training working professionals. The Business and Industry Services division has seen increased requests for customized training that we just don’t have the facilities to provide. The remodeled facilities will give us the space and flexibility to provide this additional revenue opportunity.

What is included in the project costs?

The total referendum cost approved by the Board of Directors is $79.8 million. This includes the following projects:

  • Integrated Technology Center: Complete building renovation, ground floor expansion, addition of third and fourth floors. Building will be LEED platinum certified.
  • Coleman Center: Complete interior and exterior building renovations. Demolition of annex building. New parking lot construction and south gateway. New primary and secondary entrances that include ADA-compliant elevators.
  • Diesel and Heavy Equipment Technology Center: 10,000 square foot addition to replace existing leased annex. Additional 10,000 square feet of shop space to ease overcrowding and improve safety and security. Rebuilding surface between Automotive and Diesel Centers to correct storm water.
  • Kumm Center: Remodeling of second, third, and fourth floors for Health Sciences programming. Heating and air conditioning system upgrades. Addition of window to north side of building to let in natural light. Upgrading fire sprinkler system, lighting, power, and closed caption television. Information Technology systems improvements. Addition of larger lecture classrooms and lab space.
  • Parking: A 240-stall parking ramp to be built on 8th and La Crosse Streets.
  • Greenhouse: Building a greenhouse on 7th and Vine Streets to replace rented facility.

How many new programs would this support?

This coming year alone, we will be offering three new programs: Building Systems Technology, Medical Administrative Professional, and Human Services Associate. We will also be repackaging what we already have in more flexible ways, offering certificates that can be expanded into programs if there is an occupational demand.

Western is constantly working with area employers to improve existing programs or offer additional high-demand programs to meet employer demands as business and industry changes and grows in our region.

Using a Career Pathway Model, we can ladder courses into certificates, into diplomas, into degrees, and beyond, expanding educational offerings as needed by students and employers. (e.g. CNA to LPN to RN to BSN)

Will you be adding more training programs?

Yes. Through our Business and Industry Services division, we have received requests for customized training that we just don’t have the facilities to provide. The remodeled facilities will give us the space and flexibility to provide in-demand customized training that will also provide Western with an avenue to increase revenue- generating education and training opportunities.

So, the new facilities will allow you to combine programs?

They will be co-located to make better use of space and scheduling, but will still be stand-alone programs. They will be put into “workplace models” where programs work together, much like in a real job setting. Several industrial programs can share classroom and lab space. For example, students studying mechanical design, CNC, and welding can work together in designing, modeling, and creating parts for equipment or other products. Our advisory board members, who are local business leaders, have told us how important this type of learning is to help graduates be successful on-the-job.

What will be my share of the cost?

If voters approve the referendum, Western will be authorized to borrow the necessary funds over five years. The property tax impact on the owner of a $100,000 property is estimated not to exceed $3.25 per month or $39 annually.

Will local business have the opportunity to be involved in the project?

Yes. Partnering with companies throughout our region (which includes all or parts of 11 counties) is an important part of what we do at Western. All aspects of the projects will be competitively bid and will bring significant opportunities to contractors, suppliers, and other business that support those living and working in our area. Historically, we’ve used local businesses in projects both large and small, and as vendors for departments on campus like food service.

Why not increase tuition to cover these costs?

The Wisconsin Technical College System sets the tuition rate each year for all technical colleges in the state. Western does not have the discretion to raise or lower tuition rates for any purpose.

How is Western Technical College funded?

Funding for operations comes from a variety of sources, including property taxes, tuition and fees, grants, and state aid. The chart below illustrates the breakdown:

Sources of Western's Funding

What are the ongoing operating costs for these projects?

Fixtures, furniture and equipment costs needed for the new facilities would be built into Western’s annual capital borrowing and spread over four years with no additional tax impact. Net operating costs with the new facilities have been estimated to be equal or less than Western’s current regular operating budget, based on gained energy, maintenance, and other operational efficiencies.

When was the last time Western had a referendum?

It has been nearly 20 years since we turned to the voters for facilities support. In 1992, voters passed a referendum to generate funds for upgrading campuses in Independence, Mauston, Tomah, and Viroqua. And, in 1996, we collaborated with medical and education partners in the area to build the Health Science Center.

The college has a long and strong record of prudent fiscal management and has been through a rigorous process to establish demonstrated need for these facilities. In fact, the debt for the last referendum was retired prior to 20 years.

What was achieved as a result of the 1992 referendum?

Voters passed a referendum that included funding for upgrades in Independence, Mauston, Tomah, and Viroqua. In recent years, Western has completed additional facilities improvements at all of our region locations that didn’t require a referendum.

Will the projects be voted on separately or as a package?

The college’s Board of Directors decided to present the projects to the voters in one comprehensive package, rather than asking the public to consider multiple questions on the ballot. College staff conducted a comprehensive analysis and prioritization of various high-demand program areas, and determined the six proposed projects to be those with the most significant and urgent needs. Because interest rates are so low, the college will maximize project funds and construction efficiencies by bundling these projects together.

Can the referendum be split in half? Can we pay half now and then another half in five years?

Because the facilities upgrades are part of the overall Vision 2020 plan, they need to be kept whole. If we presented each project individually, that would mean several referendums over the next several years.

The cost of renovation is far less than building new facilities. If we continue to defer maintenance and renovation the future cost will far more in building and operation costs.

Additionally, the interest rates are very low and construction costs are favorable. We don’t know what those rates or costs will be in the next several years.

If voters don’t support the referendum, what happens next?

Without taxpayer assistance, the building remodeling and additions will not take place. We will have to do our best to meet the needs of our students within the confines of our existing space. Without renovation of our facilities, it will be difficult to fulfill our mission of providing relevant, high quality education that changes the lives of students and grows our communities. If we cannot provide workers with the skills necessary for 2020 jobs, our local economy will suffer.

How much of the cost does the referendum cover? Is the college paying for any of the costs/taking out any loans?

The referendum will cover the entire cost of the facility renovations. Western can borrow the money on a per project basis over the course of five years. The money from the referendum will be used to repay the loans over 20 years. It could also be less than 20 years. The borrowing from the last referendum was paid off ahead of schedule. So, $39/year is the most taxpayers will pay, and 20 years is the longest they would have to pay.

The $39 per year tax increase … over how many years will this be?

The tax impact will be a maximum of $39 per year for up to 20 years. That’s about $3.25 per month. That’s the cost of a coffee drink and less than a gallon of gas.

Will you be taking any property off the tax roll?

The projects are all within our current property, and we will indirectly be “adding” property to the tax roll. As part of the greenhouse project, local partners are providing grant dollars that will be used to tear down the current Hillview Greenhouse, located on 24th Street off of La Crosse Street. The greenhouse facility will be rebuilt on Western property. The vacant Hillview property (5 city lots), will be repurposed as residential housing. Our students will build new Housing and Urban Development houses on those lots–one each year for five years—and making them as energy efficient as possible.

What about the parking ramp?

Parking ramps are expensive, but they are also an efficient use of space. The proposed parking ramp will be built on current parking lot space, adding more parking spaces without using additional green space or acquiring additional property. The majority of our current student population is considered commuter students, so expanded parking is necessary. With the projected increase of 1,000 more students (a 25% increase) by 2020, additional parking will become even more necessary.

When will the new facilities be completed?

Conceptual planning has been underway for months. If approved, the projects will begin in summer 2013 and are estimated to be completed by 2016.