Traverse City Record-Eagle

April 18, 2013

College may ask for more funds

BY ANNE STANTON astanton@record-eagle.com
Traverse City Record-Eagle

---- — TRAVERSE CITY — Northwestern Michigan College trustees are expected to decide next week on whether to ask Grand Traverse County voters for a property tax increase of .4 mills to help pay for daily operations.

A "yes" vote would mean a $1.7 million annual boost in college coffers — money the college needs to transform itself for the future, said NMC President Tim Nelson in an interview with the Record-Eagle editorial board.

“We’ve looked at the environment in which we operate, and it’s changing dramatically and causing us to transform as fast as we can," Nelson said.

Nelson said the board on April 22 will consider legal pros and cons of how to ask for a .4 mill increase, for example, whether to restore the existing 2.17 millage to 2.5742 — the rate approved in 1995 — or to ask for a new millage of .4042.

Nelson said NMC plans to focus on new programming, but state law bans him from specifically saying how additional annual revenues would be used.

NMC's millage request, if approved, would come before voters in August. Nelson's announcement comes at a time when Traverse City Area Public Schools is poised to decide on whether to put a scaled-down millage request before voters in November.

Voters last year trounced TCAPS' .8-mill increase request to raise $100 million for capital improvements. Since December, the district has queried community members about their support for specific capital improvements in a series of forums, surveys, and informal conversations. A scientific survey was conducted last weekend, the final piece of the study, said TCAPS Superintendent Stephen Cousins.

The TCAPS board will hear recommendations on May 6, he said.

Cousins said Nelson told him about the college’s possible millage request on Tuesday.

“I didn’t expect it when I heard about it,” he said. “As an educator and a strong supporter of NMC, I think they’re a great asset, just as I think TCAPS is a great asset. ... But it would be very difficult for me to comment on their millage proposal because I don’t know the details on it. I’d have to look at it and study it and see what it means for TCAPS.”

Nelson said big changes are in store for community colleges as students seek information to advance their skill or knowledge base, but not necessarily a college degree. The college needs to invest in training people to deliver education differently and marketing NMC out of the area, he said.

"We’ll have to spend money we’ve never had to spend before," he said.

NMC already launched programs that will teach students how to operate robots in water, land and air. NMC is expecting such specialties will attract students from around the world.The college also has reached out to area high schools to offer college-level instruction and amped up its recruiting and support of veterans.

The college unsuccessfully sought to offer four-year degrees in nursing, but Nelson predicts it will ultimately happen.

“It’s not a question of if, but when," he said.

NMC has endured declining state revenues over the last decade. Despite that, overall revenue increased by $2.9 million from fiscal year 2011 to 2012, thanks, in part, to a $2.1 million increase in tuition revenues. That reflects a 3 percent tuition hike for in-district students and a 5 percent increase for out-of-district students, as well as new registration, technology and facility fees.

Those hikes were offset by a 7 percent decline in contact hours, according to a NMC financial report.

NMC’s fund balance is $16.1 million, nearly 38 percent of its $42.6 million operating budget, said NMC spokesman Andy Dolan.

 

About Northwestern Michigan College

- Roughly 4,700 students attend Northwestern Michigan College, down from the college's record-breaking enrollment of 5,194 students in 2011. Enrollment typically rises during economic hard times when jobs are scarce, and goes down when the economy picks up again.

- 55 percent of students live in Grand Traverse County

- 29 percent live in the service area

- 14 percent live in Michigan, but not this region

- 2 percent are international and out-of-state students

The NMC taxing district includes only Grand Traverse County. Voters last approved an operating millage in 1995, bringing the total to 2.5742. As property values increased, the millage rate fell and now stands at 2.1700. The Headlee amendment limits property tax revenue increases to the rate of inflation and rolls the millage back to adjust dollars.

Since 1999, tax revenues from the millage increased from $2.1 million to nearly $4.3 million. NMC also has a construction bond millage of .77 that will be retired in 2020. The NMC board could vote April 22 to approve a ballot measure to increase the operating millage by .4 mills. That would mean a $80 increase for a house with a taxable value of $200,000, which is often below the assessed value of the home, according to the Grand Traverse County Equalization Department.