Small tax increase or big decrease
If La Crosse School District voters approve a $194.7 million referendum on Nov. 8, the district’s share of taxes on a $100,000 property would increase by $8.
If voters reject the referendum, the owner of a $100,000 property can expect a tax cut of $143.
While much of the referendum debate has focused on the proposal to merge the two high schools in La Crosse, voters also have an important decision to make regarding their tax rates, potential savings from consolidation school buildings and the long-term costs of trying to maintain aging and outdated structures.
Superintendent Aaron Engel acknowledges that there is a big discrepancy between what landlords would pay depending on the referendum result. But he said the referendum gives the district a chance to significantly upgrade its school buildings at a rate per mile that homeowners are used to paying.
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“This is an opportunity to do something big with only minimal impact on the mile rate,” Engel told a Sept. 27 audience at Trinity Lutheran Church.
The plan would consolidate the district’s middle schools from three to two and consolidate two high schools into one. Middle schools – Lincoln, Logan and Longfellow – would close and these students would occupy what is now Central and Logan High Schools. Secondary students would move into a new consolidated secondary school on Pammel Creek Road.
The proposal to eliminate Logan High School has created considerable controversy on the North Side of the city, where residents argue that the loss of the high school would negatively impact the North Side community. However, Engel says there is no longer a financially responsible way to maintain two high schools with rapidly declining enrollment.
The district has seen a 9% decline in enrollment since 2011-12, and most of the decline has occurred at the 9-12 level. Central reported a 2021-22 roster of 1,059, and Logan’s was 728. Logan’s roster is lower than Holmen (1,180), Onalaska (951), Tomah (933) and Sparta (850).
Engel said the proposed consolidations of high schools and colleges would save $4.5 million a year in operating costs.
“Consolidating into two middle schools and a high school makes us much more efficient than we are,” he said. “If we don’t go through with the referendum, we will consolidate in other areas.”
Engel said the district will minimize the tax increase by paying off existing debt in the first three years of the new bond issue. The district will borrow the $194.7 million over three years while making final payments on Northside Elementary School (2023) and capital improvements (2025).
“We are paying down some debt while adding new debt,” Engel said.
Paying off old debt is one of the reasons taxes would drop if the referendum fails. The other reason is the state funding formula for local schools.
The formula assumes, in effect, that districts with declining enrollment do not need as much revenue to run their schools. While the formula is mitigated by a “hold harmless” provision that partially protects districts with declining enrollment, Engel said recent legislation has further squeezed the district’s budget.
“They chose to spend new education dollars to drive down the per-mile rates,” he said. “They kept the same amount of money that we could have…so that reduced the local tax rate.”
Engel says the district will have to spend money on its buildings one way or another. The district has identified $81 million in infrastructure and maintenance needs across its buildings, including $18 million across the three colleges. The college’s three buildings are at least 80 years old and will require extensive renovations just to keep them functional.
“The $81 million is just for maintenance to keep the buildings as they are today…but it won’t add to the educational experience or fit the way we teach children. kids today,” Engel said. In closing colleges, he said, “We would be taking $18 million off an $81 million list.
Engel described Central and Logan as “move-in ready” for middle schoolers and would only need $500,000 in minor renovations, which is part of the referendum.
Engel does not believe that the secondary school, which he acknowledges is not centrally located, will increase transport costs. While additional bus routes will be needed to transport students from the north side to the new school, he said there will be savings with a net reduction of two school buildings. He also said the site is near the geographic center of the district, which extends south into Vernon County.
The levy projection includes a conservative estimate of interest rates, said District Business Services Manager Patricia Sprang. She said the projections take into account recent moves by the Federal Reserve Board to fight inflation with steep interest rate hikes.
“Our financial advisers made a very conservative estimate knowing that rates were rising,” Sprang said.
The district expects an interest rate between 3¾ and 4%.
While voters can, in fact, vote for a tax cut themselves on November 8, Engel is optimistic that they will see the benefits of consolidated and improved facilities.
“We know that members of our community value public education and they want the best possible education for their students,” he said. “I am convinced that our taxpayers and our citizens want great things for public education and that they are ready to invest.
La Crosse Tribune reporter Steve Rundio can be reached at [email protected]