Boots & Sabers

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Owen

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1039, 07 Dec 19

Task Force Presentation Recap

As previously noted, I re-presented the findings of the West Bend School District Private Task Force to a group of interested citizens in Jackson. The Washington County Insider streamed it live and has the recording and recap. You can find that here.

I thought the meeting went well and the Q&A was robust. With an audience of mostly folks from Jackson, there were a lot of concerns about how Jackson is perceived to be treated by the rest of the district, the economic impact of Jackson Elementary, and other concerns specific to Jackson. The most interesting discussion was about whether or not Jackson should break off and form its own district. One of the audience members shared that the Village Board approached the School Board about 20 years ago to discuss this and were dismissed out of hand. That’s unfortunate, but it is an interesting question to ponder. The rationale is that Slinger has about 5,000 citizens and has its own district. Jackson has about 5,700 citizens and does not. And the citizens of Jackson are frustrated with not being able to determine their own destiny regarding public schools.

The process to break off and create a new district is not easy.  Essentially, the West Bend School Board would have to agree. If they don’t agree, then the electors can appeal and maybe can still get it done. Then they have to pass a referendum to borrow the money to build the new schools, and actually create a new district. In the case of Jackson, it may get even more complicated. Remember that the Village and Town of Jackson actually sits in three school districts – Germantown, Slinger, and West Bend. So if Jackson wants to stretch its district boundaries to include a larger tax base, they would need to get each relevant school board to agree. If you think getting one board to agree would be hard, imaging three. If Jackson just limits a new district boundary to the part that currently exists in the West Bend School District, then they are excluding a significant tax base to support the new district.

If Jackson can get through the process, then comes the reality of building a new district. Let’s just do some simple math. I don’t have easy data for how many school age kids are in Jackson and it would really depend on where they draw the line. But there are 351 kids in the K-4 Jackson Elementary. Figure that means that with an even distribution, there are about 70 Jackson kids in each grade level. That’s a total of 910 kids. So… if there are 910 kids in the new district and they spend $10,000 per kid (that’s below the state average of $11,071), then the annual spend for the new district would need to be about $9.1 million. Of that, the state taxpayers will pay a portion. How much? No idea. But as a relatively property rich district, I would venture to say that it would be less than half. To be generous, let’s say that the state taxpayers would pay half of the cost, so local property taxpayers would have to pay $4,550,000 per year to support the district. That’s just operating cost and does not include the initial construction costs.

Still with me? OK, so here is the most recent property values of the municipalities in the West Bend School District:

So let’s say that best case, both the Village and Town of Jackson create their own district. That’s an equalized value of $950,334,000 of equalized value. To generate $4,550,000 of annual tax revenue, it would take a mill rate of 4.79 – or $4.79 for every $1,000 of property value. For a $200,000 house, that would be a tax bill of $958 per year. For comparison, the West Bend School District has a mill rate of 7.97.

With these set of assumptions, it might make financial sense for Jackson to create its own district. Of course, those assumptions may change radically. For example, if it is only the Village of Jackson and does not include the Town of Jackson, then the tax base is cut in a third. And if the taxpayers only pay for 20% or 25% of the annual cost, then the balance would have to come from the local property taxpayers. Or if they decide to spend $12,000 per child or $8,500 per child, the costs would change dramatically.

In any case, if the folks in Jackson are serious about this, they will need to figure out what they want the end state to look like and then run the approval process gauntlet. It would be an interesting evaluation. And as I said in the meeting, I would hope that the beginning and ending consideration from both the folks in Jackson and those on the West Bend School Board would be what is in the best interests of the most kids.

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1039, 07 December 2019

13 Comments

  1. Mark Hoefert

    Interesting.

    As to Slinger being population of 5,000 – that is just the Village. The geography of the Slinger school district itself is much larger than the Village of Slinger limits.  Technically school districts are a separate entity – Village of Slinger does not have it’s own district. It does not “belong” to Slinger any more than it does to Allenton, townships of Addison, Hartford, Polk, etc.

    Not sure how DPI will view a new small school district. Seems like consolidation of the smaller school districts has been the order of day more recently. Consolidation introduces the potential for operating cost savings – i.e, one Superintendent @150,000 + instead of two.

    Perhaps linking with Germantown School District would be feasible.  Still an issue of distance to their center of operations, but a lot of high value homes exist along Sherman Road – maybe someday if there is enough of that kind of development, it may be feasible for Germantown to site a new school there that could absorb Village of  Jackson population.  I doubt Slinger would cede their share of the Village of  Jackson – it is all commercial/industrial properties, no residential (no students), so that serves as a mini cash cow.

    Considering that Town of Jackson residents have consistently rejected referendum requests, I doubt that they will agree to forming a new district.

    On a different note, a wild card on future enrollment will be what happens with Milwaukee MPS and their referendum.  At one time, Jackson & West Bend’s growth was driven by white flight.  People leaving Milwaukee because of school and neighborhood conditions. This started in the late 70’s/early 80’s, and upgrading to Highway 45 to 4-lane also gave that dynamic momentum, as well as West Bend having recently built several new schools. West Bend became a community where more workers now commute to Milwaukee/Waukesha than do not. In the past it was the opposite.

    Here is what concerns me.  MPS is floating the idea of both an operating and a facility referendum.  On the low end, the tax on a $300,000 home will go from $2874 to $4716 – annual increase $1842/monthly increase $154.  On the high end, it will go to $6723 – an annual increase of $3849/monthly increase $321.

    Believe me, if that happens there will be a tsunami of new families moving to West Bend, Jackson, Slinger, etc.   Any areas that have easy access to the freeways and land that can be developed into homes where the entry point is about $350,000.

    https://www.jsonline.com/story/news/education/2019/11/19/mps-offers-first-glimpse-possible-referendum-figures/4235379002/

     

  2. Mark Hoefert

    DPI is incentivizing consolidation of school districts.  In the Jackson situation, this process would not be applicable because what is being discussed is either new school district or detachment from one district and attachment to a different one.

    I just mention this to support the point that DPI would most likely not support a new small school district.

    https://dpi.wi.gov/sms/reorganization/consolidation-incentives

    Consolidation Aid – NEW – S. 117.08 (6) and 117.09 (6), Wisconsin statutes. For a school district consolidation that takes effect July 1, 2019 or later, provide aid to a consolidated district in an amount equal to $150 per pupil attending school in the consolidated district for the first five years after the consolidation. In the sixth year, districts would qualify for 50 percent of the amount received in the fifth year after the consolidation. In the seventh year, districts would qualify for 25 percent of the amount received in the fifth year after the consolidation. Current consolidation aid provisions relating to higher cost ceilings and guarantees under the equalization aid formula, as well as related revenue limit adjustments, would not apply to these consolidations. The appropriation to pay consolidation aid is sum-sufficient (no proration).

  3. Owen

    That’s true. With the general decline in enrollment and small districts already struggling, I imagine that the DPI would not be enthusiastic about the creation of another one.

  4. steveegg

    There would also be the cost of constructing at least a combined middle/high school.  If memory serves, that was one of the main reasons the two attempts by some Caledonia residents to secede from Racine Unified over the last 2 decades failed to launch, even though they would have needed to build only a high school (assuming they inherited all the RUSD assets in Caledonia) and would have probably had, on the second attempt, two little parcels of (poorly-sited) land to do that or, more likely, provide some cash for that.

  5. Mark Hoefert

    Taking another look at your numbers and working them a different way, I may come to the conclusion that perhaps Jackson would benefit from doing an evaluation of their options.

    Figures are for school year ended 2018. Data at WI DPI.

    State Average Revenue is $13,670 per member. 42% comes from property taxes ($5773 per member).  Cost per member is $13,505, including facility cost of $850 per member.

    West Bend School District Revenue is $12,251 per member. 45.4% comes from property taxes ($5838 per member). Cost per member is $11,927, including facility cost of $850 per member.

    Slinger School District Revenue is $12,224 per member. 47.8% comes from property taxes ($5838 per member).  Cost per member is $11,522, including facility cost of $1157 per member.

    Now going to Village of Jackson – Equalized Value = $623,820,000. Current mill rate $7.97 x 623,820 = $4,917,845 property tax revenue.  That amount divided by 47.8% (Slinger’s rate) = $10,401,349 potential revenue based on averages.

    $10,401,349 divided by 910 students = $11,430 available on a per student spend.

    Not real far apart, if startup and new construction costs are reasonable.

  6. Owen

    I was just redoing the enrollment count… it’s an average of 70 kids per class this year. Of you go back the previous 5 years, the average is 75 per class, but it is declining. But the Jackson enrollment area also includes slivers of the Towns of Trenton and Polk. Still, the numbers hold up.

    Building costs (assuming that they build new and don’t buy something) would pretty huge. According to the district’s numbers, you need at least 125 sq. ft. per elementary kid, 170 for middle, and 200 for high school. At 75 kids per grade, that’s 46,875 sq. ft. for elementary, 51,000 for middle, and 60,000 for high school. That’s a total of 157,875 square feet – minimum. At a new construction cost of $225/sq.ft., that’s $35,521,875 plus the cost of land. At the maximum recommended square footage per child, it would cost $48,178,125 for 214,125 sq. ft. in buildings. Amortized over 20 years at 3% interest, that’s an additional annual cost of $2.364 million to $3.2 million. That’s a debt payment eating 25%-35% of the annual budget.

  7. Mark Hoefert

    Sounds like startup and new construction costs may not be so reasonable. Was trying to think farther outside the box – I thought in my first comments I was too quick to reject the notion of a separate district, so I wanted to correct that.

    I do think Jackson should consider finding out the numbers to make sure being part of the WBSD is in the best long-term interests of the Village of Jackson community.  Any WBSD elementary school (K-4) sited in Jackson will never be more than a feeder school for the 5th – 12th grade facilities that are located up the road in West Bend.  I have always questioned what the thought process is for families moving to Jackson, knowing that the last 8  years of education will not be in their home community.

    I am assuming that the number of kids in the attendance areas outside of the Village of Jackson would be just as close, and in some cases, closer to the West Bend facilities.  In any event, the areas west and northwest of Jackson were not part of the Jackson elementary attendance area before 2014(?).

  8. jsr

    A question asked at the presentation was “Why doesn’t Jackson have its own school district?”

    My understanding is that Jackson wanted to be part of the West Bend School District.  Further, it wasn’t a given that West Bend would accept Jackson.  Maybe that explains why Jackson is split among three districts.

     

  9. Owen

    Hmmm… actually, if you include the entire enrollment area of Jackson Elementary, they generate about $10 million in property taxes at the West Bend mill rate. If they need a budget of $12 million and state taxpayers are picking up 55% of that, then there is plenty of room for them to cover the operating budget, construction costs, and still decrease their current property tax levy. This may make financial sense for Jackson, but the WBSD would be screwed. They lose 24% of their property tax levy but only 16% of the student body.

     

  10. jsr

    If we want to think even farther outside the box, why would a Jackson school district need to build a high school?  Hartford Union High School is an example of another path.  ‘Course, which existing school district would be willing to do something like this?  (And I mention this without knowing if it’s even possible to do now.)

    As for the thought process of moving to Jackson and knowing that children would be bussed for the last eight years of school?  Both my wife and I rode the bus for at least part of our schooling.  She started for high school.  I was off and on starting in Kindergarten depending on where we lived at the time.  Our son rode the bus (or got a ride from someone) his entire school career.  Having an elementary school close enough to walk to would be nice, but I think people make too big a deal out of riding the bus.

  11. Owen

    I agree with that. I rode my bike to school for the last half of my 6th grade year. Other than that, I rode a bus until I could drive myself. I got a lot of late homework done on those buses :)

  12. Mark Hoefert

    But Owen, if Village of Jackson wants their own separate school district, it would not make sense to extend that separate district into areas that logically should remain in the West Bend School District, and the School District would have to be morons to give up those areas.  Those parts of the Town of Polk & Town of West Bend west of Highway P were not part of the Jackson attendance area until 2014, before that they were in the McLane attendance area.  Some of the homes in those areas are $1,000,000+.  I have not identified any homes in the Village of Jackson valued at $500,000+.  There would probably some in the Town of Jackson.  My home used to be Green Tree attendance area, it is now McLane. The home I grew up in used to be Barton, in the early 70’s it became Green Tree. Returning to the original attendance boundary for Jackson School would just be Village of Jackson & Town of Jackson, and the lower tier of Town of Trenton sections.  In 2014, there were about 30 students in the area west of highway P.  In the Town of Trenton tier there were about 15 students.  In almost all those cases, they are closer to McLane & Decorah than they are to Jackson Elementary.

    The elementary attendance boundaries are of a temporary nature and are meant to balance enrollment between the elementary schools. When drafted in 2013 there was an administrative recommendation that the revised map be reviewed by the Board every 5 years.

    Bottom line, school district needed to shuffle 30 students from one attendance area (McLane) into Jackson to bring that school’s enrollment up to a balanced number  – to have not done so would have resulted in Jackson’s enrollment being even lower. What you need is to know how many current Jackson students are there because of the revision in attendance boundaries, whereas in the past they would have been at McLane.

    Your presentation was correct when you said that Village of Jackson & Town of Jackson account for 16-18% of the levy.

  13. Owen

    Right. Everything depends on where you would draw the new line for a new district. If you draw it around the current enrollment area of Jackson Elementary, it makes sense for the folks in Jackson, but stinks for West Bend. Hence, it is unlikely to get approval from the West Bend School Board. But if you draw the line just around the Village of Jackson, it would not make financial sense for the folks in Jackson, but it looks good for the folks in West Bend. The only way to make it work where it is financially viable for Jackson and acceptable for West Bend would be to draw a line that includes the same proportion of kids as it does property taxes. But that line shifts every time someone with kids moves.

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