Posted 2:44 am Friday, August 27, 2010
TJC Board OKs 4-Cent Rate Hike
By EMILY GUEVARA
Staff Writer
Staff Writer
In the wake of speeches that both praised Tyler Junior College for its work in the community and decried its fiscal management, trustees approved unanimously a 4-cent tax rate increase.
The vote came after two public hearings and one public comment session in which 65 people spoke about the proposed budget and tax rate.
In all, 37 people spoke in favor of the tax rate increase. Twenty-six spoke against it. And two people did not clearly state a position.
Board President Clint Roxburgh said board members and college administrators have studied this budget and tax rate for a long time.
He said the tax rate increase reflects costs associated with the more than $24 million in maintenance tax notes issued last year and a 5 percent cut in the college's state appropriation this year.
"The one thing I want to emphasize is that these folks have our attention," he said referring to those who opposed the tax rate increase. "The board has said openly there will be no tax increase next year. Dr. Metke said that. I've said that. We intend to honor that."
With that vote, the college sets its tax rate to 18.29 cents per $100 valuation. This rate is 4.59 cents higher than the current tax rate of 13.7 cents. That's a 33.5 percent increase.
It is 4.39 cents, or 31.6 percent, higher than the effective tax rate, which is the rate that would bring in the previous year's revenue.
It is three one-hundredths of a cent below the rollback rate, which is 18.32 cents per $100 valuation.
The new rate means an annual tax bill of about $230 for the average homeowner in the TJC district. That's an increase of almost $60 compared to last year's rate for the owner of a $125,771 home.
The owner of a $100,000 home will have to pay an annual tax bill of about $183, an increase of almost $46 when compared to last year's rate.
For the last few months, TJC officials have been expounding on the reasons for this tax rate increase. On Thursday, TJC President Dr. Mike Metke, Chief Financial Officer Sarah Van Cleef and Bill King, executive director for physical facilities, laid out these reasons for the public.
It starts with last fall when the board approved the issuance of $24.5 million in maintenance tax notes. The board issued these notes in order to make repairs to critical infrastructure on the campus: things such as the electrical system, plumbing, air handlers and the chilled and hot water loop system.
Power outages and water leaks, though not daily occurrences, were all too frequent. Metke said Thursday that he had never worked at a place where he wondered each night if the facilities were going to be functional the next day. Here, he has.
The issuance of those tax notes has enabled the college to make repairs to this infrastructure, but now it must pay the bill.
In addition to this, the college faced a funding gap of almost $4 million.
Ms. Van Cleef said this gap stemmed from three things: a 5 percent cut in the state appropriation, unfunded enrollment growth, and level, or in some cases, decreasing property valuations.
In the face of this funding gap, college officials cut about $1.9 million from the proposed budgets before arriving at the final figure of $71.23 million.
The college slashed travel budgets, delayed equipment purchases, and froze hiring, among other measures.
In addition, no raises were approved for this year.
But for opponents of the tax rate increase these reasons and cost-cutting measures were not enough.
They felt that the college could cut more and that officials too quickly were turning to the taxpayers to foot the bill.
"We're in a three-year recession now and the TJC board has known that, yet they have not done anything to take that into consideration," said Flint resident Robert Russell, who opposed the increase and spoke during one of the public hearings.
Russell, 56, characterized himself as a "regular middle class kind of guy."
He said he adheres to a budget for his family -- he has a wife and two kids -- and does not have much discretionary income.
"The only time I have any kind of discretionary income is depending on what my electric bill does," he said by phone.
Russell said he opposed the increase because he felt the college has not cut back to the extent that families and the private sector have.
He estimates that between the TJC tax rate and the Smith County tax rate (if the proposed rate is approved) he will have to pay about $180 a year.
"To me that doesn't represent Starbucks coffee or Happy Meals, that's $180 worth of gasoline," he said. "That's $180 worth of groceries … My salary's been frozen so I'm counting every penny … When someone takes $180 out of my pocket, I've got to offset that."
Dr. Ann Snyder, a Tyler resident and former TJC board member, said the board's actions were disgraceful.
Dr. Snyder called on board members during her three minutes of speaking to table the budget and tax rate vote for a later meeting.
"For them to not be willing to step back for one month…" she said incredulously after the meeting. "The arrogance of increasing the budget that much for next year."
She criticized trustees for taking the choice away from the taxpayers by raising the rate just below the rollback rate so as to not allow for a potential election.
Still, the praise on Thursday far outweighed the criticism when it came to the speakers.
Several students addressed the board talking about how the school has helped them to achieve their dreams. They said they are working to pay for their college education and any increase in tuition has major implications.
Cindy Klein said she viewed the situation as people can pay now or pay later. If they pay now, they ensure a vibrant college that will continue to drive the economy and supply a quality workforce to the community, she said.
If they pay later, it may be in the form of a decline in a quality workforce or opportunities for people.
"I'm happy for my increase, I think it's very small and insignificant in the grand scheme of things," she said.
Rush McGinty said he feared those in opposition to the tax rate increase drowned out the supporters.
"We need to provide (the students) with an opportunity, and I think we are willing as citizens of this county to support you in giving them that opportunity," he said.
When board members arrived at the time to vote on the tax rate, trustee David Hudson made the motion and trustee Mike Coker made the second.
Prior to the vote on the budget, trustee Ann Brookshire said she wanted to make clear that the fact the college was not giving pay raises to employees was no reflection of the job the employees were doing.
"They're the driving force behind this college," she said.
