Declining Enrolment and Property Taxes Up To $112 for Idaho Community Colleges
Nationwide, community colleges are seeing sharp declines in enrollment. Two out of the three community colleges in Idaho also are seeing huge enrollment declines. The College of Southern Idaho (CSI) experienced about a 1500 student drop while Northern Idaho College (NIC) had a whopping 2635 student decline in the last few years. However, instead of taking less property tax money as their enrolment has declined, these schools have incredibly increased what they take from property owners. (See the Numbers Don't Lie tab on the left).
Both CSI and NIC are in population areas similar to that of Bonneville County. The only outlier to this national trend in Idaho is the College of Western Idaho (CWI) in Nampa which had both recent periods of student enrolment declines, and some increases in enrollment. Some enrollment increases were dut to the fact that CWI included dual enrollment high school students. For example, in 2014, CWI actually had a 10% decrease in on-campus non-high school student enrollment!
Because CWI is located in the Boise valley with a population of over 1 million people and has experienced a huge population explosion which is expected to continue, we believe that CWI is located in an area so different that it is an apples and oranges comparison to us. CWI can’t honestly be used in any comparisons to a proposed community college in Bonneville County. To use CWI's statistics in any discussion about a college in Eastern Idaho is disingenuous at best.
CSI and NIC are located in similar population centers and attract similar types of students that a college in Idaho Falls would attract. Opponents also point to national trends showing community colleges are an educational model that seem to be on losing their appeal. Students are electing for more online opportunities and dual credits, which are being provided regardless of if a community college is nearby.
In Pocatello, which does not have a community college, dual credits completed by high school students continue to rise. Idaho Falls has a campus of the Pocatello based Idaho State University and can grow their dual credit offerings to high school students for no charge through state funding already in place. In fact, EITC currently offers dual enrollment classes. See tab on the left titled "Dual Enrolment Information."
Besides declining national enrolments opponents note that tax costs to property owners near CSI and NIC are significant. NIC was started in the 1930’s and through the years have built numerous buildings over the years. All but one is completely paid for. NIC ’s taxing district, Kootenai County, collects over $15 million per year in local property taxes to keep the college operational. This amount calculates to a tax of $112 per year per $100,000 in property taxes. NIC is in a taxing district with over $13 billion in taxable property. A college in Bonneville County running a similar budget would have a property tax rate of $ 394.47 per year per $100,000 in taxable value. This higher yearly cost to each taxpayer is because the total taxable value of property in Bonneville County is significantly less, at just above $6 billion.
CSI has a taxing rate of $98 per year per $100,000 in taxable value for residents in its’ taxing district of Twin Falls County. CSI’s 2016 budget shows no expenditures for new buildings. Opponents to Bonneville County’s college proposal refute the claim that local property taxes will remain low because Eastern Idaho Technical College has all the buildings in place that the new college will use. They note that CSI and NIC have their buildings in place and property taxes are significantly higher than what proponents in Bonneville County are claiming starting tax rates will be for a college in Idaho Falls.
To be clear, the proponents of the new taxing district in Bonneville County have claimed that taxpayers will see a new tax bill of $15 per $100,000 in taxable value the first year of the college’s operation. This is based off a non-binding projected budget assembled by a committee of various proponents who wrote a report referred to as the “panel report.” The panel report estimated that the new community college might have an expected financial shortfall of approximately $851,000.00 in the first year of operation.
Based upon that estimate in the panel report and a county wide taxable property value of just over $6 Billion, the county would need to levy a new tax of $15 per $100,000 in taxable value to cover the loss. However, opponents note, the panel report is a non-binding estimate of basic institutional operations and neglects potential budget additions that could occur in the first year of the college's operations.
The college’s first year budget will be determined by a five member board that will be appointed by the Idaho State Department of Education. This board will be eventually replaced by elected board members as various terms expire of those that are originally appointed. The appointed board will chose first year spending priorities, and has sole authority to determine how large the first year budget deficit will be.
The ballot question put before the voters on May 16, 2017 has no financial information or constraints on said spending. Opponents point out that the only limiting language for the appointed board is found in state code 33 which limits the total levy rate to $125.00 per year per $100,000 in taxable value. That maximum levy rate will give the new board access to over $7,500,000 in property tax revenue, based off Bonneville County’s taxable property value of just over $ 6 Billion. Opponents note that the newly appointed board members could ask the county for that amount each year without further voter approval once the taxing district is established.
Because the panel report’s estimated budget is a projection and is not binding, there is little basis to support the claim that the first year tax increase property owners will be charged will be $15 per $100,000 in taxable property. Opponents note the panel report is only a suggestion and the writers have no authority to affect the college’s actual first year budget. They note that a likely scenario would be that the newly appointed board, because they have the authority to, would likely fund additional start up projects ranging from salary increases, building remodels, possibly parking lot expansions, and numerous other “wish list” items not found in the panel report.
As stated, the appointed board can spend up to $7,500,000 derived from property taxes without any voter approval. This first year budget request which the board will make to the property tax payers will be a complete unknown until the actual budget is set. Likewise, the new tax rate also remains an unknown, except it cannot exceed the state cap of $125 per year per $100,000 in taxable value. Any tax quotes before the final budget is set is purely speculation and should be labeled by the proponents as such.
Opponents of the new taxing district fear this newly appointed board will ignore the panel reports’ estimated budget projections and use other data and spending requests to formulate a budget requiring much higher property tax rates. They point out a new tax rate of $25, $50, or even $100 per year per $100,000 in taxable property is as possible as the panel report’s suggest $15 rate. Because the other community colleges in Idaho tax in the $98 to $112 per year range it might be a logical argument that the college in Idaho Falls start out at the level to be in line with other state institutions.
The board also has the authority to increase property tax rates each year by 3% without voter approval. If the board decides not to increase its’ request in any given year, they are entitled to recapture any untaxed revenue in any future year. This taxing authority is called "forgone revenue". Forgone revenue can be significant. If the starting tax rate of the community college is $100 per $100,000 in taxable value, the amount property owners can be taxed grows to $134.39 per year after 10 years. In 20 years, the annual property tax grows to $180.61 per $100,000 in taxable value. Proponents called the 3 percent increase insignificant on a radio debate on KID radio on April 21, 2017.
The board can also ask the community to pass levy increases anytime. These are typically for additional building projects including remodeling of existing structures, new buildings, or parking lots, or other wants. These requests are normally voted on and require a super majority approval. Other Idaho community colleges have made numerous tax rate requests, the latest being a $180,000,000 ballot measure from CWI in November of 2016. The ballot measure failed.
The May 16th election will require a super majority approval, which a previous attempt at a community college failed to achieve in 1991.
CSI’s 10 year enrollment high was 9086 students. http://magicvalley.com/news/local/csi-enrollment-drops-almost-percent/article_698cb0a3-3d94-5933-8423-2424fc04ff7e.html
CSI’s enrollment has plunged to 7615 students in 2016, which is almost a 1500 student decline!https://www.cappex.com/colleges/College-of-Southern-Idaho
NCI 2011 enrollment was 8982 http://www.cdapress.com/article/20170201/ARTICLE/170209970
NCI 2016 enrollment 6347, a drop of 2635 students https://www.cappex.com/colleges/North-Idaho-College
Community Colleges are a thing of the past as they see sharp declines in enrollment nationwide https://www.eab.com/daily-briefing/2016/10/24/the-real-reasons-community-college-enrollment-is-falling
CWI has had recent periods of declining on campus enrollment. This decline was only hidden by dual credit high school students being counted into their total enrolment numbers. See:
NCI collects $ 15,210,260 in local property taxes in 2015 (see page 18)
NCI’s local property tax levy rate in 2015 was $112 per $100,000 in taxable property (see page 57) https://www.nic.edu/about/annualFinancialReport.pdf
NCI has a taxing district that has just over $13 billion in total taxable value. This produces the $15,210,260 the college is collecting with a levy rate of $112 per $100,000 in taxable value. Bonneville County has about $6 billion in total taxable value. To collect a similar $15,210,260 revenue, a local property tax rate in Bonneville County would have to be about $394.47 per year per $100,000.00 in taxable property.
The state taxing levy cap for community colleges is $125 per $100,000 in taxable value is found in Idaho Code 33-2111 and surrounding chapters
Information about CWI’s $180,000,000.00 failed bond in 2016 can be found here: http://www.ktvb.com/news/politics/elections/voters-reject-180m-college-of-western-idaho-bond/350293587