In the November 3, 2020 election, the Owen-Withee School District has placed a referendum on the ballot for a slight increase in the mill rate for district property owners. We met with Owen-Withee District Administrator Bob Houts to discuss the referendum and building project in detail.
In part one (September 8 edition), we discussed the need for the building project. This week we talked about the funding itself.
As a reminder, the Referendum wording will appear as follows: “Shall the School District of Owen-Withee, Clark and Taylor Counties, Wisconsin be authorized to issue pursuant to Chapter 67 of the Wisconsin Statutes, general obligation bonds in an amount not to exceed $3.15 million for the public purpose of paying the cost of a school building and improvement project consisting of: construction of additions and renovations at the Middle/High School for academics, including technical education space, a new cafeteria/community/multi-purpose space and kitchen; and acquisition of furnishings, fixtures and equipment?” With a checked-box response of Yes or No.
Sentinel & Rural News (SRN): Let’s discuss the mill rate and the impact on taxpayers in the Owen-Withee District.
Bob Houts (BH): The mill rate for 2020-21 is scheduled, the way I calculate it, to go down to $8.08. Actually, it may be even lower than that right now because we lost some kids, so the revenue limit goes down. Right now, the rate is $8.62. The impact of the referendum will be 42¢ which will take the mill rate back up to $8.50. That means the comparison to last year is 8¢ LESS than the 2019-20 year.
SRN: So, with the passing of the referendum, the Owen-Withee District taxpayer is still paying LESS than last year.
BH: Correct. So, we build the new kitchen/cafeteria/multi-purpose space and the Tech Ed addition and we are still 12¢ lower than last year. All good news.
SRN: Walk us through this process. We’ve been through referenda before but how was it achieved this time?
BH: The wording of the referendum was from the Quarles & Brady law firm. They have all the postings and procedures. So, after the passing of the resolution on August 17, we posted all the notices around town and in your paper. We worked with them on all of that end.
Then Market & Johnson, the construction company, came up with the budget. They had originally come up with a referendum of about six million dollars and we just said ‘No, we can’t do that.’ They whittled it down and came back with a budget of about five million dollars. With the FEMA Grant of almost two million dollars, that left us with a referendum amount of 3.15 million dollars.
Now it must be said that the Tech Ed addition is $800,000 and that is not included in the FEMA Grant. That is money that we have to raise solely through the referendum. FEMA will only contribute to the dome project.
SRN: Who helped with the tax impact?
BH: That was RW Baird who helped us with that, with what it means to the levy. They wrote the analysis and they know the loans. On every one of these, the construction estimate is high. The estimate on what we will pay on the interest of the loan is high. We have calculated that the tax impact will be on a 3.5% loan but we have been told that we can probably get that in the higher 1% or lower 2% but they don’t know what the market is going to look like in early November, whenever we lock that in. So, we are trying to be conservative that way to better report good news instead of ‘Uh oh. It’s higher than we thought.’
SRN: With the conservative estimates in loan rate and construction costs, what is the good news?
BH: I can see that the impact may be lower, not tremendously lower, but even a little bit lower is always welcome. We are just trying to insure against surprises. I just think that we are going to come out with better news than what we are projecting now.
SRN: What’s the bottom line?
BH: It’s all good news! People are paying less this year than last year and will pay less again next year, 2020-21. A downward trend in mill rates is a great way to go. But we have always been pretty consistent between the upper 7s and lower 9s. And we have the lowest mill rate second only to Neillsville in our area. Even with the passing of the referendum we are still lower than all of our neighboring districts, except Neillsville.
SRN: It also looks like several of our neighbors are going with the FEAM dome.
BH: Yes, Spencer just broke ground. Now Abbotsford is going with it. But here’s the thing, if we don’t pass the referendum, the project is over. We would have to return the $2 million to FEMA.
SRN: So, without the referendum, you cannot do any of the building project?
BH: No. Dead.
End of Part 2. Next week, the benefits of the dome.
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